Lawyer Discpline

The Board of Attorneys Professional Responsibility, an arm of the Wisconsin Supreme Court, assists the court in discharging its exclusive constitutional responsibility to supervise the practice of law in this state and to protect the public from acts of professional misconduct by attorneys licensed to practice in Wisconsin. The board is composed of eight lawyers and four nonlawyer members, and its offices are located at Room 410, 110 E. Main St., Madison, WI 53703, and 342 N. Water St., 3rd Floor, Milwaukee, WI 53202.

Disciplinary Proceeding Against Jill S. Gilbert

On July 2, 1999, the Wisconsin Supreme Court ordered a two-year suspension of the law license of Jill S. Gilbert, 40, Milwaukee, effective Aug. 16, 1999. From March 4 to Aug. 16, 1993, Gilbert represented a disabled 63-year-old man suffering from congestive heart disease and chronic depression who had no close relatives. The man had a stock portfolio valued at $254,000, a condominium valued at $95,000, and a watch collection valued at up to $75,000.

When Gilbert first met with the client, he was in a nursing home following a heart attack, and he was unable to make arrangements on his own to return home. Gilbert was retained to manage his financial affairs, determine his rights, and identify alternatives regarding payment for his care and services, for which she was to be paid $125 per hour. The client soon gave Gilbert a durable power of attorney and power of attorney for health care. One copy of the durable power set forth a $95 per hour fee and another copy stated $150 per hour. The client's first check to Gilbert bore the notation "37 hours at $95." The client returned home supported by various services and a nursing care evaluation was done. The evaluator's recommendation that psychological testing be performed was not followed.

In the next months, the client was hospitalized three times for various problems, including dementia and confusion. Gilbert served as liaison with the physician, caregivers, and case managers. For the month of March, Gilbert kept handwritten notes of her hours, in and out of the office, but had the client sign a typewritten statement that did not state the number of hours or the fee. Thereafter, no handwritten records were kept of her time and charges. On July 1, 1993, the client signed a revised statement for March showing the hours Gilbert worked out of the office, but not stating the total hours or fee rate, and indicating a balance due of $16,200. The fee would have been $17,950, if billed at the $125 per hour rate. From April 4, 1993 to July 31, 1993, Gilbert billed the client for 704.3 hours at $125 per hour, minus credits, for a total of more than $86,000.

On May 23, Gilbert wrote the client that she was concerned that her fees would soon deplete his assets and proposed to limit her services to 35 hours per week in June and July and 30 hours per week in August and September. In June she wrote a summary of her deposits and withdrawals of his funds, indicating a withdrawal for fees of $44,443 although the individual statements totaled only $36,252.

Also in June, Gilbert looked into a state program assisting persons needing care to stay in their own home. Besides an asset limit, there was a two-year waiting period and the client had to qualify for benefits by Oct. 1, 1993. Gilbert consulted with an attorney ethics advisor regarding details of a plan to place the client's funds in her account, and she would provide legal services and health-care related case management services. The attorney advised her of the need when entering into a business transaction with a client to fully explain the matter to the client, give options, suggest independent counsel review any agreement proposed, obtain the client's written consent, provide for a refund upon termination, and possibly videotape signing of any agreement. The attorney did not see the final agreement Gilbert gave to the client to sign. Pursuant to that agreement, Gilbert was to receive $154,000 to be deposited in a joint account, then Gilbert would withdraw 65 percent to be put in an account for the client's care and the remaining 35 percent would pay the taxes Gilbert expected to incur as a result of receiving the funds. Gilbert was to provide up to 30 hours of services per week, with 24-hour-a-day availability, for 24 months. The agreement terminated if the client's expenses exceeded the reserved funds. The court found that it was improper for Gilbert to charge her client for the advisor's services, because they were for Gilbert's benefit and not the client's.

On July 20, 1993, Gilbert videotaped what purported to be her explanation of the agreement to the client, his consent, and execution of the agreement. The referee describes the videotape as showing "extremely chaotic circumstances" in the client's home, stating there were two young children "running, screaming," a loud and distracting television set, and a housekeeper who prompted the client. The client is described as having obvious physical and cognitive problems, noticeable tremors, flat affect, looking dazed, and having periods of confusion. Gilbert addressed the client in rapid speech and raced from topic to topic, putting words in his mouth. When Gilbert discovered that the client had already signed several copies, she turned off the camera, then resumed taping, directing the client to sign and date the already executed documents.

The referee stated: "That (Gilbert) continued to record this charade is unconscionable. That she would rely on the videotape to show that her client understood the many complex provisions of the document, i.e., divestiture, tax, fees, termination, et al., is in reckless disregard of her responsibility to her client."

The court adopted the referee's finding that Gilbert engaged in dishonesty, fraud, deceit or misrepresentation, in violation of SCR 20:8.4(c), by giving the Board of Attorneys Professional Responsibility (BAPR) a videotape that purported to show her client's execution of the agreement.

Before the agreement was signed, Gilbert liquidated $46,800 from the brokerage account and transferred the account to another broker. She then transferred $90,000 from the brokerage account to a new joint trust checking account. The day before the agreement was signed, she transferred $74,380 from the brokerage account to the joint account. Nine days later, she withdrew approximately $110,000 from the joint account and put it in her business account. She then opened a trust account for the client with $24,000 from the joint account. After the client terminated the representation and filed a grievance on Aug. 16, Gilbert withdrew $10,800 from the trust account as fees for services she claimed she rendered prior to signing the agreement. The court found that Gilbert had violated the trust account rules by withdrawing funds for fees in dispute and by commingling her own funds (earned fees) with those of her client, in violation of SCR 20:1.15(a) and (d).

The court found that Gilbert had made misrepresentations in her billings regarding meetings with the client that did not occur and that they contained duplicative entries. The court did not find credible Gilbert's testimony that errors in the billings had been made by a clerical person in her office who she was unable to name. The court found that Gilbert had engaged in conduct involving dishonesty, fraud, deceit or misrepresentation, in violation of SCR 20:8.4(c).

In addition, Gilbert obtained a $3,000 cashier's check on the client's funds, payable to an appliance store, when his television did not work. After learning that the remote just needed new batteries, Gilbert returned to the store and used the check to buy a large screen television for her home. Gilbert entered an unidentified deposit of $3,000 on the trust account check register, and a withdrawal in the same amount, subsequently claiming it was a credit to her client as partial payment of legal fees. The court found that Gilbert did not immediately advise BAPR of the actual use of the check during its investigation and had misrepresented to successor counsel that she had purchased a large screen television for the client. Gilbert also identified the check to successor counsel as an "unused money order" when it was a cashier's check and had been used to purchase the television set. This conduct also constituted a violation of SCR 20:8.4(c).

The court also adopted the referee's finding that Gilbert charged and collected excessive and unreasonable fees, in violation of SCR 20:1.5(a)(1). Over six months Gilbert paid herself $112,000 for services she claimed to provide. BAPR's expert witness testified that case management services were available for $65 to $95 per hour and personal services for $10 per hour. The referee determined that a reasonable fee for Gilbert's legal services, social work services, paralegal services, running errands, and bookkeeping services was $27,200. Gilbert also failed to act with diligence and promptness in managing her client's financial affairs, allowing his checking account to be overdrawn and failing to deposit a Medicare check into his account, in violation of SCR 20:1.3. Further, Gilbert failed to keep her client reasonably informed about the status of his financial situation and explain the provisions of the case management agreement in a manner that would permit him to make informed decisions regarding them, in violation of SCR 20:1.4(a) and (b).

The court adopted the referee's recommendation that Gilbert be ordered to make restitution to her client, within 60 days, in the amount of $84,800 plus interest payable from August 1993. Gilbert also was ordered to pay the costs of the proceedings.

Public Reprimand of Michael J. Masnica

On June 3, 1999, BAPR publicly reprimanded Michael J. Masnica, 36, Kenosha, for misconduct in three separate matters.

On Nov. 23, 1994, Masnica was appointed by the Public Defender's Office to represent a client in seeking post-conviction relief. Masnica received the transcripts and court records on the case between Dec. 23, 1994, and March 20, 1995, and reviewed the matter during this period. Masnica wrote an initial letter to the client on March 17, 1995. Masnica received a letter from the client on April 23, 1995, and again reviewed the transcripts. Masnica then determined that the case lacked merit and took no further action on it. Masnica received a collect call from the client on Aug. 23, 1995, which was not accepted, because Masnica was not present in his office. Masnica states he heard nothing further from the client. The client states that he spoke to Masnica by telephone on one occasion in late 1994, but has heard nothing since that date, despite numerous phone calls and letters to Masnica.

In another matter, on Nov. 23, 1994, Masnica was appointed by the Public Defender's Office to represent a second client in seeking post-conviction relief. Masnica received the transcripts and court records between Dec. 6, 1994, and mid-March 1995. Shortly thereafter, Masnica completed his review of the case and determined that it lacked merit. Masnica sent the second client a letter on March 17, 1995, and states that he received no response to that letter. However, Masnica later discovered that he did receive a letter from the second client, dated March 13, 1996. Masnica discovered this letter, unopened, when preparing his files to send to the Public Defender's Office in late 1998. Masnica took no further action on the case, and never informed the second client of his opinion that the case lacked merit.

The second client states that he has only received one letter from Masnica, dated March 17, 1995, informing him that he had been appointed to represent him, and that he would soon arrange a teleconference. The second client states that the teleconference never took place and that this is the only communication he has received from Masnica, despite numerous attempts to contact Masnica by telephone and letter.

In another matter, on March 15, 1996, Masnica was appointed by the Public Defender's Office to represent a third client in seeking post-conviction relief. Masnica received the transcripts and court records on the case between March 22, 1996, and April 16, 1996. Masnica wrote to the third client on April 25, 1996, and again in December 1997. Masnica states that he received no response to either of these letters and took no further action on the case. The third client states that he has tried to contact Masnica many times, but was never successful, and that the only communication he received regarding this matter was a copy of the Order Appointing Counsel.

The first client contacted the Public Defender Appellate Division by letter dated March 4, 1996, complaining that Masnica was not responding to his attempts to contact him. An Appellate Division attorney forwarded the client's letter to Masnica by letter dated March 25, 1996. The letter reminded Masnica of his obligation to respond to a client's reasonable requests for information and to act with reasonable diligence.

The first client again contacted the Public Defender Appellate Division by letter dated May 25, 1998, asking that new counsel be appointed because of Masnica's failure to contact him. An appellate division deputy first assistant noted that the client's case, and the cases of two other clients whom Masnica was appointed to represent, remained open. The deputy first assistant spoke with Masnica by telephone on June 12, 1998, and inquired about the status of all three cases. Masnica told the deputy first assistant that he would review the files and get back
to him.

When the deputy first assistant did not hear back from Masnica, he called and left messages for Masnica on July 28, 1998, Aug. 20, 1998, and Aug. 27, 1998. When there was still no response from Masnica, the deputy first assistant sent Masnica a certified letter dated Aug. 31, 1998, which was delivered on Sept. 1, 1998. Masnica did not respond to this letter.

By letter dated Nov. 25, 1998, the deputy first assistant asked that Masnica send him his complete files on all three cases. When no response was received, the deputy first assistant sent a follow-up letter, dated Dec. 15, 1998. Masnica sent the transcripts and court records to the deputy first assistant on Jan. 29, 1999.

BAPR found that, by failing to take any action on the cases of the first two clients for more than three years and failing to take any action on the third client's case for more than a year, Masnica failed to act with reasonable diligence and promptness in representing a client in violation of SCR 20:1.3.

BAPR also found that, by failing to inform the first and second clients of the status of the cases for more than three years and failing to inform the third client of the status of his case for more than one year, Masnica failed to keep clients reasonably informed about the status of matters, in violation of SCR 20:1.4(a).

BAPR further found that, by failing to inform the first and second clients of his opinion that their cases lacked merit and their right to have a no-merit report filed, Masnica failed to explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation, in violation of SCR 20:1.4(b).

Disciplinary Proceeding Against Daniel J. Raymonds

The Wisconsin Supreme Court imposed a temporary suspension of the law license of Daniel J. Raymonds, 43, Milwaukee, commencing Aug. 9, 1999. The court ordered that the suspension remain in effect pending the disposition of an ongoing disciplinary proceeding against Raymonds.

In May 1997 BAPR commenced a disciplinary proceeding against Raymonds alleging multiple trust account violations. Raymonds represents mortgage lenders, buyers, sellers, and brokers with respect to real estate transactions, and tens of millions of dollars in closing proceeds have gone through his trust account on a monthly basis. In February 1995 there was a shortfall in the trust account and, as a result, there were insufficient funds to cover six checks that were presented for payment. After the bank notified Raymonds of the shortfalls, he deposited $150,000 in personal funds into his trust account. BAPR also alleged that Raymonds had failed to keep appropriate trust account records and did not reconcile the trust account on a monthly basis.

In the fall of 1997, the referee ordered Raymonds to audit his trust account for the period between 1993 and September 1997. When an audit report was not forthcoming, BAPR filed a motion with the court on March 30, 1999, seeking a temporary suspension of Raymonds' law license. On April 15th the court ordered Raymonds to show cause why his license should not be suspended. On June 16, 1999, the court ordered BAPR's motion be held in abeyance until Aug. 2, 1999, thereby affording Raymonds an additional one-and-a-half months to furnish the audit results to BAPR. On Aug. 3, 1999, BAPR received an audit report that covered only two years of the period that was to be audited. The report also failed to address the shortfall in the account, and further failed to address the possibility of losses to third parties. Finally, the audit report indicated that Raymonds was still not complying with trust account record keeping requirements. Consequently, the court imposed the temporary suspension.