| 323 Ore. 99, *; 913 P.2d 695, **;
1996 Ore. LEXIS 33, ***
|
In the Matter of the Application of C. ANDERSON GRIFFITH, Applicant, for
Reinstatement as an Active Member of the Oregon State Bar.
SC S33097
SUPREME COURT OF OREGON
323 Ore. 99;
913 P.2d 695;
1996 Ore. LEXIS 33
March 6, 1995, Argued and submitted
April 4, 1996, Filed
PRIOR HISTORY:
[***1]
On review from the opinion and order of a Trial Panel of the Disciplinary
Board.
DISPOSITION: Application for reinstatement granted.
COUNSEL: Jeffrey D. Sapiro, Desciplinary Counsel, Lake Oswego, argued the cause and
filed the opening brief for the Oregon State Bar.
John D. Ryan, Portland, and C. Anderson Griffith, applicant pro se, argued the
cause and filed the answering brief.
OPINION:
[*101]
[**696] In Banc
PER CURIAM
Applicant, C. Anderson Griffith, has applied to this court to be reinstated as
an active member of the Oregon State Bar (Bar) pursuant to Bar Rule of
Procedure (BR) 8.1. Applicant was admitted to practice in Oregon in 1968. He
was disbarred by this court in December 1987 for misconduct in the course of
business dealings and investments unrelated to his ordinary law practice.
In re Griffith, 304 Ore. 575, 637-38, 748 P.2d 86 (1987) (Griffith I). The Board of Governors of the Bar reviewed the application for
reinstatement and, by a vote of seven to six, recommended to this court that
reinstatement be denied. Pursuant to BR 8.8, this court referred the matter to
a trial panel of the Disciplinary Board to inquire into applicant's moral
character and general fitness to practice law.
[***2] After a hearing, the
trial panel unanimously recommended that this court reinstate applicant to the
practice of law. We accept that recommendation and grant the application for
reinstatement.
Before his
disbarment, applicant and his law partner, Thomas E. Wolf, together with two non-lawyers,
formed a mortgage company called First Northwest. That company specialized in
short-term construction loans for real estate developers. Applicant and his
partners borrowed capital from Columbia Pacific Bank, an entity for which Wolf
was chief legal counsel and for which applicant provided some
litigation-related representation. The partners of First Northwest also
individually acquired shares in Columbia Pacific. Eventually, after a number of
sham transactions involving First Northwest and unlawful stock sales, Columbia
Pacific became insolvent, causing losses to a number of investors. n1
304 Ore. at 578-82.
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n1 This court's opinion in
In re Griffith, 304 Ore. 575, 578-82, 748 P.2d 86 (1987), contains a detailed account of applicant's conduct leading up to the collapse
of Columbia Pacific.
- - - - - - - - - - - - - - - - -End Footnotes- - - - - - - - - - - - - - - - -
[***3]
[**697] During the same time, applicant, Wolf, one of their First Northwest partners,
and First Northwest also had formed a transportation company, called
Trans-West, for the purpose of chartering aircraft. Applicant and Wolf served
as counsel for that company. Wolf improperly signed the name
[*102] of the non-lawyer partner as the guarantor for the purchase price of an
airplane. When Trans-West defaulted on the loan, applicant and Wolf advised the
non-lawyer partner to convey real estate owned by him personally to Trans-West,
which in turn mortgaged the real estate to the seller of the airplane as
security for the debt. Trans-West
subsequently defaulted again and the airplane was repossessed. The non-lawyer
partner was required to pay $ 100,000 to secure the release of his real estate.
304 Ore. at 583, 632-34.
The Bar filed a formal complaint against applicant and Wolf. n2 In applicant's
disbarment proceeding, n3 the trial panel found applicant guilty of four out of 39 causes
of the complaint and selected
disbarment as the appropriate sanction. Upon automatic de novo review, this court found
applicant guilty of 10 out of 39 causes of the complaint and disbarred him.
Id. at 577.
- - - - - - - - - - - - - - - - - -Footnotes- - - - - - - - - - - - - - - - - -
n2 Wolf resigned from the Bar during the Bar's investigation into his alleged
misconduct.
In re Griffith, 304 Ore. at 591.
[***4]
n3 We refer to the disciplinary proceeding that ultimately led to applicant's
disbarment as his
"disbarment proceeding" throughout this opinion.
- - - - - - - - - - - - - - - - -End Footnotes- - - - - - - - - - - - - - - - -
The material facts surrounding the events that led to
applicant's
disbarment were undisputed during the
disbarment proceeding. However, during that proceeding, applicant argued that his
involvement in First Northwest was not misconduct. Among other things,
applicant argued that he was not conversant in the affairs of First Northwest,
that
"he was an 'intersection' or personal injury trial lawyer[,] and that he placed
complete trust in Wolf who was [an] expert in the field of business and finance
law and therefore he paid very little attention to the affairs of First
Northwest."
304 Ore. at 618. This court rejected applicant's argument that he was a bystander to the
fraudulent business dealings:
"The record shows that Wolf was the quarterback who called the signals. It also
shows that Griffith was not a third-string tackle who sat on the far end of the
bench. He made at least two trips to meet with members of [a venture to which
First Northwest
[***5] loaned money]. Griffith was an incorporator, shareholder, director and an
officer of [another venture]. The Articles of Incorporation were forwarded to
the
State of Oregon over his signature. Later
[*103] Griffith was responsible for firing a $ 3,000-per-month employee of [the
second venture] to save money and thereafter met periodically with the
company's accountant to discuss [another venture]. Griffith's role was more
like a first-string blocking back who played most of the time and who along
with the quarterback was responsible for the win or loss."
304 Ore. at 618-19.
This court also determined that, although applicant cooperated with the Bar
during his disciplinary proceeding,
"on some occasions [his] answers were not truthful."
Id. at 635. Ultimately, this court concluded:
"This is a sad case. A lawyer who had a fine reputation as a trial lawyer got
outside his field. A combination of blind faith in a partner whom he considered
to be his friend and an expert in the financial field plus plain old-fashioned
greed 'did him in.' It maybe that
Wolf was [the] one who was selling the sack of rotten potatoes to the
unsuspecting buyer, but Griffith had his foot on the
[***6] scales. We have found him guilty of four causes involving dishonesty and six
causes involving conflicts of interest." n4
304 Ore. at 637-38.
- - - - - - - - - - - - - - - - - -Footnotes- - - - - - - - - - - - - - - - - -
n4 The court found that applicant had violated the following disciplinary
rules: DR 1-102(A)(2) (1980) (circumventing a disciplinary rule through the
actions of another); DR 1-102(A)(3), (4), and (6) (1980) (engaging in conduct
involving moral turpitude; engaging in conduct involving dishonesty, fraud,
deceit, or misrepresentation; engaging in conduct that adversely reflected upon
his fitness to practice law) (multiple counts); DR 5-101(A) (1980) (accepting
employment when his independent professional judgment was or reasonably may
have been affected by his own financial, business,
property, or personal interests) (multiple counts); DR 5-104(A) (1980)
(entering into a business transaction with a client with differing interests
and the client expected him to exercise his professional judgment for the
client's protection) (multiple counts); and DR 5-105(A) (1980) (accepting
employment when his exercise of his professional judgment in behalf of his
client was or was likely to be adversely affected by the acceptance of the
proffered employment) (multiple counts).
In re Griffith, 304 Ore. at 595-634.
- - - - - - - - - - - - - - - - -End Footnotes- - - - - - - - - - - - - - - - -
[***7]
[**698] After his
disbarment, from 1988 until 1993, applicant worked as a paralegal and investigator for his
former law firm. Since 1993, applicant has worked as a claims consultant to
insurance companies.
In December 1992, five years after his
disbarment, applicant filed an application for reinstatement to the Bar. n5
[*104] In May 1993, the Bar's
Board of Governors investigated applicant's request and, by the close vote
already noted, recommended that this court deny reinstatement. Applicant sought
review of that recommendation. In October 1993, this court remanded the matter
to a trial panel of the Disciplinary Board for an evidentiary hearing.
- - - - - - - - - - - - - - - - - -Footnotes- - - - - - - - - - - - - - - - - -
n5 BR 6.1(d) (1992) provided that
"[a] disbarred attorney may not apply for reinstatement until five years has
elapsed from the effective date of his or her
disbarment." The rules now make
disbarment permanent for those matters in which
disbarment is the sanction for a formal complaint filed on or after January 1, 1996. BR
6.1(e), 8.1(a) (iii) (effective January 1, 1996).
- - - - - - - - - - - - - - - - -End Footnotes- - - - - - - - - - - - - - - - -
[***8]
During the July 1994 trial panel hearing, n6 applicant presented 303 letters
and recommendations and called 24 witnesses to
testify in support of his reinstatement. The evidence showed that roughly
one-third of the $ 11 million in losses arising from the failure of Columbia
Pacific was attributable to the activities of First Northwest. Applicant paid,
settled, or compromised all the claims brought against him as a result of his
involvement with First Northwest and Columbia Pacific. Applicant also settled
with the Federal Deposit Insurance Corporation (FDIC) before the FDIC filed a
claim against him and fully cooperated with the FDIC in its claims against
other parties arising from the failure of Columbia Pacific. Applicant did not
personally communicate with many of the individual investors who had suffered
financial losses as a result of the failure of Columbia Pacific and did not
personally try to determine whether any outstanding claims remained after
completion of the FDIC settlement.
- - - - - - - - - - - - - - - - - -Footnotes- - - - - - - - - - - - - - - - - -
n6 We refer to the trial panel hearing as applicant's
"reinstatement hearing" throughout this opinion.
- - - - - - - - - - - - - - - - -End Footnotes- - - - - - - - - - - - - - - - -
[***9]
Applicant
acknowledged at the reinstatement hearing that he had failed to disclose to
clients with whom he and Wolf had entered into financial transactions that, as
counsel for First Northwest as well as a shareholder in that company, applicant
had personal and business interests that potentially conflicted with those of
his clients and that those clients should seek independent counsel. Applicant
also conceded that his misconduct had harmed his clients. Further, applicant
acknowledged that he knew the relevant banking laws and that Wolf had used him
to circumvent those laws. Applicant also agreed with this court's finding that
applicant,
"although at times semi-passive, was a willing participant in a dishonest scheme
that in effect transferred a bad loan in the amount of $ 1.1 million from First
Northwest to Columbia
[*105] Pacific."
304 Ore. at 621-22. Finally, applicant stated that he could not justify the conduct that had led
to his
disbarment and that he
"[could not] understand the contrast of why I would behave so poorly on one hand
and well on another."
In October
1994, the trial panel unanimously recommended that applicant be reinstated. We
have mandatory review of the trial
[***10] panel's recommendation. ORS 9.539; BR 10.2. The Bar asks this court to deny
reinstatement.
BR 8.1(b) provides:
"Each applicant under this rule must show that the applicant has good moral
character and general fitness to practice law and that the resumption of the
practice of law in this state by the applicant will not be detrimental to the
administration of justice or the public interest. No applicant shall resume the
practice of law in this
[**699] state or active membership status unless all the requirements of this rule are
met."
The trial panel concluded that applicant satisfactorily had shown that he
possesses the good moral character and general fitness required to practice law
and that his resumption of the practice of law would not be detrimental to the
administration of justice or the public interest. We review that determination
de novo. ORS 9.536(3); BR
10.6.
In reinstatement proceedings, the applicant has the burden of proof.
Specifically, BR 8.12 provides:
"An applicant for reinstatement to the practice of law in Oregon shall have the
burden of establishing by clear and convincing evidence that the applicant has
the requisite good moral character and general
[***11] fitness to practice law and that the applicant's resumption of the practice of
law in this state will not be detrimental to the administration of justice or
the public interest."
"Clear and convincing evidence means that the truth of the facts asserted is
highly probable."
In re Nash, 317 Ore. 354, 357, 855 P.2d 1112 (1993) (internal quotation marks omitted). Any significant doubt about whether an
applicant for reinstatement has sustained that burden must be resolved in
[*106] favor of protecting the public interest by denying reinstatement. See
In re Jaffee, 319 Ore. 172, 177, 874 P.2d 1299 (1994) (stating that rule in an original application proceeding).
When deciding whether an applicant for reinstatement has sustained the burden
to prove that he or she is of good moral character,
"the question is whether in all respects [the applicant] is a person who
possesses the sense of ethical responsibility and the maturity of character to
withstand the many temptations which [the applicant] will confront in the
practice of law."
In re Nash, 317 Ore. at 362 (internal quotation marks omitted; emphasis in original).
In considering an application for reinstatement, we
[***12] also must answer the question of whether the applicant presently is of good
m9ral character. See
In re Fine, 303 Ore. 314, 317, 736 P.2d 183 (1987) (stating that rule in an original application proceeding). Nonetheless,
"evidence of past acts or conduct may be relevant to that issue if rationally
connected to [the] applicant's fitness to practice law." Ibid.
In fact, when a lawyer has been disbarred for past conduct, it is very
difficult for that person to prove by clear and convincing evidence that he or
she is of good moral character for the purposes of reinstatement. See
In re Koken, 214 Ore. 357, 361, 329 P.2d 894 (1958) ("It has been recognized that stronger proof of good character is required to
restore a disbarred lawyer than that required upon his [or her] admission to
the Bar."). When a disbarred lawyer applies for reinstatement, the applicant must prove
a reformation of character, by clear and convincing evidence, during the time
between the occurrence leading to
disbarment and the application for reinstatement. See
id. at 360 (the court is
"entitled to have a reasonable assurance that the misconduct which brought the
petitioner before this court once
[***13] before will not reoccur").
In a sense, a lawyer who is seeking reinstatement after
disbarment must prove by clear and convincing evidence not only that he or she generally
is of good moral character, but also that he or she has overcome and will not
again be influenced by the specific character flaw that led to
disbarment. Thus, the focus of the inquiry in a reinstatement case is on reformation. We
acknowledge that often it will be very difficult to show that reformation,
because
"reformation is a
[*107] very difficult matter for a petitioner to prove and for us to judge because
evidence of morality is not ordinarily adducible in positive form."
In re Bernard Jolles, 235 Ore. 262, 275, 383 P.2d 388 (1963).
In applicant's
disbarment proceeding, this court cbncluded that applicant was motivated by
"old-fashioned greed," coupled with
"blind faith in a partner whom he considered to be his friend and an expert in
the financial field."
In re Griffith, 304 Ore. at 637-38. This
court also concluded that applicant acted out of
"a dishonest and selfish motive."
304 Ore. at 636. Thus, in this case, applicant has the burden to show that he has reformed his
character by overcoming the characteristics
[***14] of greed, dishonesty,
[**700] and selfishness that resulted in his
disbarment.
In determining whether an applicant has proved a reformation of character, this
court looks to many different types of evidence, including: character evidence
from people who know and have had the opportunity to observe the applicant;
evidence of the applicant's participation in activities for the public good;
evidence of the applicant's forthrightness in acknowledging earlier wrongdoing,
In re Jaffee, 319 Ore. at 178; evidence of the applicant's adequate resolution of any previous substance
abuse problem,
In re Rowell, 305 Ore. 584, 591, 754 P.2d 905 (1988); and evidence of the applicant's willingness to pay restitution to those people
harmed by the applicant's earlier
misconduct,
In re Graham, 299 Ore. 511, 520, 703 P.2d 970 (1985). Applicant presented evidence of all the types listed above.
Character Evidence
As mentioned above, 24 witnesses testified on applicant's behalf at his
reinstatement hearing. Applicant also submitted more than 300 favorable letters
and recommendations from judges, lawyers, and others, all urging that applicant
be reinstated. At the outset, we note that a common
[***15] theme among much of the character evidence offered in support of applicant's
reinstatement was that applicant is of good moral character and that his
misconduct was an isolated incident that was inconsistent with his normal good
character. Many of the proponents for reinstatement who
[*108] professed applicant's excellent reputation and good moral character also had
expressed that view during applicant's
disbarment proceeding.
References from professional and personal acquaintances often are reliable
sources of evidence of an applicant's moral character. See
In re Bernard Jolles, 235 Ore. at 275 (in original application proceeding, proof of reformation generally is made
through testimony by those living and working with the applicant). We
emphasize, however, that the focus of our inquiry is whether applicant has
reformed the characteristics that led to his
disbarment. We view with caution testimony that applicant always has had good moral
character, because it contradicts the principal conclusion of this court in the
disbarment proceeding and is not determinative of the question of whether applicant is
likely to repeat his misconduct. Such evidence did not convince this court that
[***16] it should not disbar applicant and a repeat of that evidence at the
reinstatement hearing does not advance materially our inquiry about applicant's
possible reformation.
However, aside from that sort of repetitive character evidence, applicant also
presented evidence that does demonstrate that applicant has reformed his
tendencies toward greed, selfishness, and dishonesty. The lawyer who supervised
the FDIC litigation and the final FDIC settlement offered the most significant
evidence of applicant's reformation. At the reinstatement hearing, that lawyer
testified that applicant was the only lawyer out of a group of about 30 who
voluntarily settled with the FDIC using his own money, before the FDIC filed a
claim, rather than waiting for insurance money to cover any of his liability.
The lawyer also emphasized that the voluntary and complete cooperation of
applicant and one other lawyer in the FDIC litigation was absolutely
instrumental to achieving the successful settlement.
Upon completion of the FDIC settlement and after applicant was disbarred, the
supervising lawyer also represented applicant in two garnishment proceedings
involving several First Northwest title insurance policies.
[***17] At the reinstatement hearing, the lawyer testified that he was
[*109]
"extremely impressed" in witnessing applicant's conduct during the five years of that litigation
when contrasted against the conduct described by this court in Griffith I, such
as applicant's willingness in the past to make false statements for his own
benefit. According to the
lawyer, there were
"literally dozens of times" during which applicant had the opportunity to make false statements in order
to gain an advantage or benefit his interests in the garnishment litigation.
However, applicant continuously rejected the opportunity to engage in the same
type of misconduct that this court criticized in Griffith I. Instead, applicant
"always stuck to what [he] believed to
[**701] be the absolute truth and never, under any circumstances, would go beyond it."
Additional character evidence presented at the reinstatement hearing also
demonstrates that applicant took steps to reform his character. Several
witnesses and letter-writers stated that, after the failure of Columbia
Pacific, applicant changed his lifestyle and no longer viewed personal
financial gain as a paramount concern. Further, many proponents of reinstatement
[***18] thought that applicant acted admirably when he rejected several lucrative
offers of employment after being disbarred and, instead, chose to work as a
paralegal in the
firm in which he had been a partner. Those witnesses pointed out that, as a
paralegal, applicant was in daily contact with his former colleagues and was
constantly reminded of his status as a disbarred lawyer. However, applicant
accepted the fact that he could not practice law and worked diligently as a
paralegal for his former partners and subordinates. One of applicant's former
partners also testified that, through his
disbarment, applicant had learned not to take the privileges and responsibilities of being
a lawyer for granted.
Activities for the Public Good
At his reinstatement hearing, applicant testified that he is a charter member
of the Hell's Canyon Preservation Council and that he is involved in other
conservation work. Applicant also presented evidence that he founded an
[*110]
"over-40" soccer league for the Portland area and that he volunteered to coach and
manage recreational soccer for the Portland Indoor Soccer League. n7
- - - - - - - - - - - - - - - - - -Footnotes- - - - - - - - - - - - - - - - - -
n7 Applicant testified, however, that he was involved
in soccer for his personal recreational enjoyment and did not seek out that
activity as a way to help the community.
- - - - - - - - - - - - - - - - -End Footnotes- - - - - - - - - - - - - - - - -
[***19]
Applicant also testified that he sought to do pro bono legal work through the
Bar, which reportedly could not find an appropriate project for a disbarred
lawyer. Applicant also acted as a mentor and teacher of sorts at the firm that
employed him as a paralegal, discussing the pitfalls of misconduct and
providing educational seminars for new lawyers in the firm on ethical trial
practices and other litigation matters.
Acknowledgment of Wrongdoing
One of the most important aspects in addressing the question of reformation is
whether the applicant has acknowledged his or her wrongdoing and has taken
responsibility for his or her misconduct. See
In re Gortmaker, 308 Ore. 482, 488-90, 782 P.2d 421 (1989) (reinstatement denied, in part, because the applicant failed to admit his
misconduct and
minimized the gravity of his misconduct). At his reinstatement hearing,
applicant presented evidence that he recognizes the gravity of his earlier
misconduct and that he regrets the injury that he caused to many people.
Applicant testified that he
"felt bad" about any harm that he may have caused individual investors in First Northwest
and stated that he took
"full responsibility" for
[***20] his misconduct. Applicant also stated that
"I have friends that to this day will tell you it is all Tom Wolf's fault, and
they are wrong. That's what they believe. It is my fault." Applicant further expressed that, as a result of being disbarred,
"I've suffered great shame, but it is shame that is mine."
In addition, many witnesses and letter-writers emphasized that, upon his
disbarment, applicant never offered any excuses for his misconduct, never tried to blame
anyone else, including Wolf, for his misfortune, and never criticized the Bar,
this court, or this court's opinion in Griffith I. One of applicant's former
partners stated that applicant
[*111] repeatedly pointed out to that partner that applicant himself had caused the
problems that led to his
disbarment. That same former partner also testified that, after being disbarred, applicant
demonstrated a commitment to understanding all that had occurred and his role
in those events. The partner testified that
"when [applicant] got that Supreme Court opinion and he realized that people he
respected had found him guilty, he began to try to really look at the whole
thing and try to understand what had really happened. And that
[***21] was a long, slow, painful process. He would say, Well, gosh, I can admit that,
but I don't see how they could find this, and then he'd work on it and
[**702] work on it. And pretty soon he'd come back and say, You know, they are right."
Finally, in his testimony before the trial panel, applicant acknowledged and
agreed with the findings contained in Griffith I, including the conclusion that
he had violated numerous disciplinary rules. Applicant also acknowledged that,
during his
disbarment proceeding, he did not think that he had engaged in any misconduct or illegal
activities.
Resolution of Alcohol and Personal Problems
During his
disbarment proceeding, applicant never asserted that alcohol or any other personal
problems contributed to his misconduct and, consequently, Griffith I contains
no findings about the effects of such problems, if any existed, on applicant's
behavior. Nevertheless, evidence that those problems did exist and that
applicant sought to resolve them is helpful to the question of whether
applicant has taken steps to reform his character. Evidence presented at the
reinstatement hearing demonstrates that, in the period of time following the
failure of
[***22] Columbia Pacific and continuing after his
disbarment, applicant stopped drinking alcohol entirely and strengthened and improved his
relationships with his wife and his former partners. Applicant also began
paying off the enormous debt that had accumulated as a result of the failure of
Columbia Pacific and eventually satisfied his personal debts.
[*112]
Willingness to Pay Restitution
Evidence of an applicant's attempts to compensate
people who were injured by the applicant's misconduct may affect our
determination of whether the applicant has reformed his or her character. See
In re Graham, 299 Ore. at 520-21 (denying reinstatement, because
"the primary deficiency in [the] applicant's rehabilitation is his apparent lack
of interest in informing himself of what money is owed to former clients and in
making restitution to those former clients"). As previously noted, applicant paid, settled, or compromised all claims
brought against him due to his misconduct. He also voluntarily settled his
liability with the FDIC, using his own funds, before the FDIC filed an action
against the parties responsible for the failure of Columbia Pacific. Finally,
applicant cooperated with the FDIC
[***23] and facilitated the FDIC's final settlement with all involved parties.
The Bar argues that applicant still has not made full restitution, because
applicant did not affirmatively seek out other victims who did not make claims
against him personally
in order to apologize and to compensate those victims for their losses. Those
facts are true, and we acknowledge that those actions would make a stronger
case for applicant's willingness to pay restitution. However, we view the
record as a whole and conclude that applicant's failure to take those steps is
not the result of an unwillingness to pay restitution for his wrongs, or of an
unreformed, selfish moral character.
Moreover, the evidence presented at the reinstatement hearing demonstrates that
the purpose of the final FDIC settlement was to satisfy all actual and
potential claims arising from the failure of Columbia Pacific and that
applicant's purpose in fully cooperating with the FDIC was to facilitate
satisfaction of those claims. The evidence also demonstrates that the final
FDIC settlement achieved the goal of satisfying all actual and potential
claims; after the final settlement distributions, a residue of approximately $
1 million
[***24] in insurance proceeds remained. By virtue of his voluntary and forthright
participation in the FDIC settlement, then, applicant did
demonstrate a willingness to further the principle that all involved parties
receive restitution.
[*113]
Conclusion
After considering the evidence presented, we conclude that applicant has proven
by clear and convincing evidence that he has reformed the deficiencies in those
character traits that led to his
disbarment. Consequently, we find that applicant possesses the good moral character and
general fitness required to practice law and that applicant's resumption of the
practice of law will not be
[**703] detrimental to the administration of justice or to the public interest.
Application for reinstatement granted.
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