In re Wenk

In re Wenk  (95-486); 165 Vt 562; 678 A.2d 898

[Opinion Filed 30-Apr-1996]


                               ENTRY ORDER

                      SUPREME COURT DOCKET NO. 95-486

                              APRIL TERM, 1996


In re Craig R. Wenk                  }     APPEALED FROM:
				     }
				     }
                                     }     Professional Conduct Board
				     }
				     }
				     }     DOCKET NO. 95-10


       In the above-entitled cause, the Clerk will enter:

       The Board found that Respondent's negligence caused no actual damage
  and that he paid for his misconduct through the settlement of the
  malpractice suit.   Respondent is remorseful and has cooperated with these
  disciplinary proceedings.  In light of these of mitigating factors, the
  Board's recommended sanction of a public reprimand is approved.



     BY THE COURT:


Dissenting:
				   _______________________________________
_______________________________    John A. Dooley, Associate Justice
Frederic W. Allen, Chief Justice
				   _______________________________________
______________________________     James L. Morse, Associate Justice
Ernest W. Gibson III, Associate Justice
				   _______________________________________
				   Denise R. Johnson, Associate Justice


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                                 Dissenting


       ALLEN, C.J. and GIBSON, J., dissenting.   The Professional Conduct
  Board found that Respondent violated DR 1-102(A)(4) by not candidly
  answering a question regarding his client's status in litigation in which
  the Respondent was representing the client, and that he knowingly engaged
  in misrepresentation by omission by not informing his client that he had
  lost his interest in property in Vermont by default.  It also found that he
  violated DR 6-101(A)(3) by failing to file an answer to a Petition to
  Partition and by failing to communicate with his client.  It concluded that
  while his initial misconduct was due to negligence he later knowingly
  deceived his client for more than a year and knowingly failed to represent
  him diligently.

       A majority of the Board indicated that had there been evidence of
  actual injury in the case, it would have recommended suspension.  The ABA
  Standards for Imposing Lawyer Sanctions (1991) state that suspension is
  generally appropriate when a lawyer knowingly fails to perform services and
  causes injury or potential injury to a client, 4.42(a) (emphasis added),
  and when

 

  a lawyer knowingly deceives a client and causes injury or potential injury
  to the client, 4.62 (emphasis added).  The misconduct found certainly had
  the potential for injury to the client and warranted suspension under the
  ABA Standards.

       It is apparent from the Board's opinion that it believed that if it
  recommended suspension that the suspension had to be at least six months
  because of our opinion in re Rosenfeld, 157 Vt. 537, 601 A.2d 972 (1991). 
  The Board felt that a suspension of that duration would be too severe in
  this case.  We did indicate in Rosenfeld that the ABA Standards recommended
  that if a lawyer is to be suspended, the suspension should have a duration
  of at least six months, and imposed a six-month suspension in that case. 
  Id. at 547, 601 A.2d  at 978.  We noted that the rationale in the commentary
  to ABA Standard 2.3 is that a short-term suspension with automatic
  reinstatement is not an effective means of protecting the public and that a
  six-month suspension is needed to protect client interests.  Id.  That
  rationale does not appear to be applicable in this case as the Board found
  that the Respondent was experiencing personal problems and physical
  impairment during part of his representation, cooperated with the
  disciplinary proceedings, is remorseful, and has settled the malpractice
  action arising from his misdeeds.

       In our view, Rosenfeld does not foreclose suspensions for less than
  six months.  Indeed, we imposed a two-month suspension following the
  decision in Rosenfeld.  In re Doherty, 162 Vt. 632, 650 A.2d 522 (1994). 
  The ABA recommendation that suspensions should be for a period of time
  equal to or greater than six months is prefaced by the word "generally" and
  is not intended to apply in every instance.  Further, our rules governing
  the operation of the Professional Conduct Board clearly contemplate
  suspensions of less than six months.  A.O. 9, Rule 20B (lawyer suspended
  for less than six months may resume practice at end of period of
  suspension).  We agree with the dissenters on the Board that Respondent's
  conduct warrants more than a public reprimand.


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101.PCB

[01-Sep-1995]


                             STATE OF VERMONT

                        PROFESSIONAL CONDUCT BOARD

                                     
                                     
In re:  Craig R. Wenk, Respondent
          PCB File No. 95.10
          

                     FINAL REPORT TO THE SUPREME COURT

                         Decision Number  101     

       This matter was presented to us by stipulated facts following a waiver
  by Respondent of his right to proceed by a petition of misconduct.  We have
  accepted the stipulated facts and adopted them as our own, incorporating
  them herein by reference.  They are briefly summarized below.

                                   Facts

       Mr. Wenk has been a member of the Vermont Bar since 1974 and practices
  in Wilmington, Vermont.

       In October of 1990, Respondent agreed to represent Robert S. Dyer, Jr
  in connection with a partition action.  This client had invested in two
  real estate ventures with his parents who had mortgaged their Connecticut
  home to finance the projects.  One project was in Manchester, Vermont;  the
  other was in Myrtle Beach, South Carolina.  A few years after these
  ventures were begun, a disagreement arose within the family.  The parties
  could not agree as to how income from these two ventures was to be shared. 
  The parents separated and the mother brought a partition action in Vermont
  against her son and her husband.  

       About a month after Respondent undertook this representation, he
  suffered 

 

  unexpected, acute and serious medical problems which totally
  debilitated him for an extended period.  He did not resume the full
  practice of law until March of 1991.  Because of this illness, he neglected
  Mr. Dyer, Jr.'s case for several months.

       The partition complaint was filed in January of 1991 against both
  father and son.  While the father filed an answer through his own counsel,
  Respondent did not file an answer on behalf of the son.

       Subsequently, the mother filed for a default judgement against
  Respondent's client and for summary judgment against her husband. On May
  29, 1991, the court granted the Judgement of Partition and appointed
  commissioners to sell the property. 

       Respondent did not inform his client of this order.  He had lost track
  of it due to his illness, and he was distracted by other personal problems. 
  He did not turn his attention to this case again until some ten months
  later when he received a letter from Salvatore Agati, a Connecticut lawyer
  who also represented Robert S. Dyer, Jr.  

       Mr. Agati was defending their mutual client in a Connecticut suit by
  the father against the son for failure to contribute to the mortgage note
  held on the South Carolina property.  Mr. Agati had filed a counterclaim
  against the father, averring that whatever was owed on that mortgage note
  was set-off by the amount the father owed the son on the Vermont property. 
  Mr. Agati wrote to Respondent in March of 1992 to inquire as to the status
  of the Vermont partition proceedings so that he could adequately defend Mr.
  Dyer, Jr. in the Connecticut proceedings.

       At this point, Respondent became aware of his earlier neglect of his
  client's case.  However, rather than informing either his client or Mr.
  Agati of the default, he chose to 

 

  remain silent.  Respondent merely informed Mr. Agati that the property was
  awaiting sale by the court appointed commissioners and that when the
  property was eventually sold, the proceeds would be held in escrow pending
  further hearing as to distribution. Respondent did not communicate at all
  with his client.
  
       In June, Mr. Agati and Respondent corresponded further about a
  proposed settlement of the Vermont dispute.  Nothing came of that
  correspondence.  Eventually, Mr. Dyer, Jr. sold the South Carolina
  property, keeping the entire proceeds of $30,000, but paying his father
  $16,000 to settle the Connecticut law suit.  This left only the Vermont
  partition action pending.

       In January 1993, the commissioners sold the Vermont property for
  $15,000 less than the Dyer family had paid for it in 1987.  Mr. Dyer, Jr.
  had no knowledge of this sale.  The court then considered how to distribute
  the proceeds.  The parents agreed between themselves as to how the proceeds
  would be split between them.  Respondent did not file anything on behalf of
  his client.  A default order was entered against Mr. Dyer, Jr. who received
  nothing from the proceeds. 

       Mr. Dyer, Jr. eventually learned from a third party that the property
  had been sold and the proceeds distributed.  He brought a legal malpractice
  action against Respondent which was settled to Mr. Dyer, Jr.'s
  satisfaction.

                                Conclusions

       By not candidly answering Mr. Agati's question about their mutual
  client's true status in the partition litigation, Respondent violated DR
  1-102(A)(4)(a lawyer shall not engage in conduct involving dishonesty,
  fraud, deceit, or misrepresentation).  

 

  Additionally, Respondent knowingly engaged in misrepresentation by omission
  by not informing his client that he had lost his interest in the Vermont
  property by default.

       Respondent also violated DR 6-101(A)(3)(a lawyer shall not neglect a
  legal matter entrusted to him) by failing to file an answer to the
  petition, failing to ensure that his client's interests were protected
  while Respondent was physically unable to do so, and failing to communicate
  with his client.  The Board is particularly troubled by Respondent's
  conduct after March of 1992 when Respondent realized he had neglected the
  case, yet took no steps to protect his client's interests.

       In determining the appropriate sanction, we consider first the duty
  violated, the lawyer's mental state, the actual or potential injury caused,
  and any aggravating or mitigating factors.  Standard 3.0, ABA Standards for
  Imposing Lawyer Sanctions (1991).

       Duty violated:  In the first instance, Respondent failed to fulfill
  his duties of candor and diligence which he owed to his client.  In regard
  to his dealings with Mr. Agati, Respondent's lack of candor violated his
  duty to the public to maintain his personal integrity.

       State of mind: Initially, Respondent's misconduct was due to
  negligence. However, after March of 1992 and continuing for more than a
  year, Respondent knowingly deceived his client and knowingly failed to
  represent him diligently.

       Injury:  We cannot determine whether Mr. Dyer, Jr. was actually
  injured financially by Respondent's misconduct since no accounting of his
  interests and liabilities in the Vermont property was ever made.  It may be
  that he was not entitled to any funds from the sale. However, since the
  converse might also be true, there was clearly a 

 

  potential for serious financial injury.

       Mitigating factors:  Respondent experienced personal problems and
  physical impairment during some part of his representation of Mr. Dyer,
  Jr., has paid other penalties for his misconduct through the settlement of
  the malpractice suit, co-operated with these disciplinary proceedings, and
  is remorseful.

       Aggravating factors:  There were multiple offenses here, although we
  do not find a pattern of misconduct since only one client was involved. 
  Mr. Dyer, Jr. was a vulnerable victim since he did not live in Vermont and
  had few avenues of first-hand knowledge about his case.

       Also, Respondent has substantial experience in the practice of law as
  well as a prior disciplinary history.  In 1991, we privately admonished
  Respondent for violating DR 9-102(B)(3)(failing to maintain complete
  records of all funds, securities, and other properties of a client coming
  into the possession of the lawyer and render appropriate accounts to his
  client regarding them).  In re:  PCB File No. 90.20, Decision No. 17
  (1991).  That violation occurred in 1989 and was the result of negligent,
  not knowing misconduct.

       Having considered the factors set out at Standard 3.0, we note that
  several sections of the Standards apply.  These sections support imposition
  of either a public 

 

  reprimand or suspension from the practice of law. 

       Had there been any evidence of actual injury in this case, we would
  not hesitate to recommend that a lawyer who knowingly deceives his client
  as to the status of pending litigation should be suspended.  However, the
  majority is mindful of the Supreme Court's position that suspension of
  lawyers for a period of less than six months is inappropriate.  We feel
  that a suspension of that duration would be far too severe in this case. 
  In this case the injury is speculative and was at least partially a product
  of Respondent's medical disability.  In such circumstances, we feel that a
  suspension would serve merely a punitive function.

       Therefore, we follow the recommendation of both parties and recommend
  that Respondent be publicly reprimanded.  We do so with the expectation
  that such a 

 

  sanction will fully protect the public from further misconduct.

       Dated at Montpelier, Vermont this 1st   day of September, 1995.

                                           PROFESSIONAL CONDUCT BOARD
                                           

                                                /s/
                                           ___________________________
                                           Robert P. Keiner, Esq.
                                           Vice Chair


     /s/                                        /s/  
___________________________                ___________________________
Charles Cummings, Esq.                     Donald Marsh


     /s/                                        
___________________________                ___________________________
Joseph F. Cahill, Esq.                     Karen Miller, Esq.


                                                /s/
___________________________                ___________________________
George Crosby                              Jane Woodruff, Esq.


     /s/
___________________________                ___________________________
Paul S. Ferber, Esq.                       Robert F. O'Neill, Esq.


                                                /s/
___________________________                ___________________________
Nancy Foster                               Ruth Stokes



                                           ___________________________
                                           Mark Sperry, Esq.


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                              DISSENTING OPINION

                                           
       In our view, this case is on all fours with ABA Standard 4.62 which
  mandates suspension in cases when a lawyer knowingly deceives a client and
  causes injury or potential injury to a client.  There is no dispute that
  there was knowing deceit and the potential for significant injury here. 
  Although we feel this should not be a long-term suspension, we feel that
  the stipulated facts warrant a sanction stronger than a public reprimand.

     /s/                                        /s/
________________________________           ___________________________
Nancy Corsones, Esq.                       Rosalyn Hunneman


/usr3/wsc/9510.opinion