Professional Discipline
Disciplinary proceeding against John W. Strasburg
The Wisconsin Supreme Court revoked the law license of John W.
Strasburg, 51, Milwaukee, commencing April 21, 1998, and ordered him to
pay $2,500 in restitution to a client, and the full costs of the
disciplinary proceeding. The court also found Strasburg in contempt of
its 1990 suspension order and imposed a remedial contempt sanction,
prospectively. The contempt sanction will require Strasburg to pay a
forfeiture of $500 per day and will be applicable if he continues to
practice law.
In March 1990 the court suspended Strasburg's license for two years,
based upon conflicts of interest and excessive fees relating to his
representation of clients regarding Title 19 divestitures and probate.
Strasburg's practice was incorporated as ElderCare Asset Protection
Plans Inc. (See, 64 Wis. Law. 48-50 (May 1990).) Following the
suspension, Strasburg continued to operate ElderCare and provided advice
and service to clients regarding financial planning and Title 19
qualification.
While suspended, Strasburg prepared trusts, powers of attorney,
living wills, declarations to physicians, health-care powers of attorney
and deeds, and advised clients regarding those documents, all in
contempt of the court's suspension order. (SCR 22.26(2) and SCR
20:5.5(a).) Strasburg denies that ElderCare is a law firm; however, his
marketing material stated that Eldercare "provides a completely legal
family financial and estate plan" and that it also guides its clients
"through the proper, legal steps" to protect parents' assets. Strasburg
also failed to advise potential clients, who asked if he was an
attorney, that his license was suspended (SCR 20:8.4(c) and SCR
20:7.1(a)), and charged unreasonable "legal fees" (SCR 20:1.5(a)).
In one matter, Strasburg met with two women regarding the
preservation of their father's assets. He provided them with a written
outline of services, indicating that he would prepare a trust, a
physician's declaration, and if necessary, a durable POA and health-care
POA. They paid him $2,500. The women subsequently contacted several
attorneys to compare fees, and discovered that the same services could
be performed for less than half the $5,000 fee Strasburg was charging.
The women terminated Strasburg's services and asked for a refund of the
unused retainer. Strasburg refused, despite having done no work for the
clients.
In another matter, Strasburg was retained by a woman who wanted to
preserve her father's assets. All of the woman's contacts with him were
via telephone or mail. Strasburg sent her a packet of documents,
including a POA, and a trust. The POA was signed by the woman and her
father and returned to Strasburg. However, the father had been declared
incompetent approximately six weeks earlier. Despite the fact that
Strasburg had not witnessed the execution of the POA, he signed the
document as a witness, and had his assistant improperly notarize the
father's signature. (SCR 20:8.4(c).)
In a final matter, Strasburg was consulted by an elderly man with no
close relatives concerning a $215,000 annuity that was due to be
renewed. Strasburg drafted a custodial trust for the benefit of eight
charities, funded by the proceeds of the man's annuity; a declaration of
trust; and a transfer under the Wisconsin Uniform Custodial Trust Act.
(SCR 22.26(2) and SCR 20:5.5(a).) Each of those documents designated
Strasburg as the custodial trustee. Strasburg also prepared a POA,
appointing himself as the man's agent to handle his property, and a
health-care POA and declaration to physicians, designating himself as
the man's health-care agent. Strasburg transferred the trust's assets
from one to another of several accounts, including his business and
personal accounts, which were not designated as trust accounts. He
misrepresented to the man that an account containing some of the trust's
assets had a $49,650 balance, when the account's actual balance was
$350. In addition, and contrary to law, he failed to notify seven of the
eight charities that they were beneficiaries of the trust and failed to
provide them with annual statements regarding the trust's
administration. In addition, he used assets from the trust for personal
purposes, including nearly $14,000 for newspaper advertising for his
business. (SCR 20:8.4(c).) The funds subsequently were replaced.
Strasburg also failed to respond to Board of Attorneys Professional
Responsibility (BAPR) inquiries regarding the trust, refused to produce
his records regarding it, and failed to cooperate with any of BAPR's
other investigations. While the investigations were pending, Strasburg
petitioned to resign from the State Bar. However, the court held his
petition in abeyance, pending the disposition of the investigation and
any consequent disciplinary proceeding. (SCR 22.07(2) and (3) and SCR
21.03(4).)
Disciplinary proceeding against Leslie J. Webster
On April 29, 1998, the Wisconsin Supreme Court suspended the law
license of Leslie J. Webster, 44, Ellsworth, for two years, retroactive
to Jan. 21, 1998, the date on which the court ordered a summary
suspension of Webster's license. Webster was convicted in federal court
on one count of aiding and abetting the fraudulent concealment of a
debtor's property from a bankruptcy court. He was sentenced to 15
months' imprisonment.
Using his professional position, Webster counseled his client to make
a fraudulent representation in the bankruptcy regarding the status of a
tavern that the client was purchasing on a land contract. The bankruptcy
papers recited that the tavern recently had been surrendered to the
vendor of the land contract in exchange for a release of the unpaid
balance on the contract. The papers did not disclose that the tavern had
been incorporated and that the client's interest in it had been conveyed
to the corporation. Nor did the papers disclose any ownership of stock
in the business.
The court accepted the stipulation of Webster and BAPR that the
conduct for which Webster was convicted constituted the commission of a
criminal act that reflects adversely on his honesty, trustworthiness,
and fitness as a lawyer, contrary to SCR 20:8.4(b). The court accepted
the parties' stipulation that Webster's conduct was aggravated by his
active participation in the fraud; his advice and counsel to the client
that contributed significantly to the client's participation in the
fraud and his conviction and incarceration for it; Webster's false
testimony during the trial; and Webster's prior discipline, a public
reprimand in 1990.
The court also accepted the parties' stipulation regarding mitigating
factors. First, the client's creditors were not deprived of assets
because the client had had no equity in the tavern. Second, Webster did
not benefit personally from his fraudulent conduct. Third, Webster has
assisted charities and civil groups in his community. Finally, Webster
fully cooperated during BAPR's investigation of this matter.
Disciplinary proceeding against David J. Winkel
On April 21, 1998, the Wisconsin Supreme Court publicly reprimanded
David J. Winkel, 38, Neenah, based on his failure to do necessary legal
work in two client matters, which caused serious repercussions to the
clients. Winkel also failed to cooperate in the BAPR investigation in
one of the matters.
In the first matter, Winkel represented a couple who wanted to close
down their remodeling business. Winkel failed to determine how much the
clients had received for three remodeling projects still in progress,
the disbursements that had been made to subcontractors in those
projects, and the claims of subcontractors that remained to be paid out
of the funds that had been received. If Winkel had obtained that
information, he would have learned that there were approximately $33,000
in subcontractor bills that should have been paid out of those deposits,
but were not. As a consequence, he did not tell the clients that if they
used the monies in their company accounts for something other than the
payment of the subcontractor bills, they would risk being charged with
felony theft by contractor.
The clients used the remaining funds for purposes other than the
payment of subcontractors: They gave $5,000 to Winkel's firm, and paid
the rest to their bank in exchange for release of their personal
guarantees on a loan they had received from the bank to purchase the
business.
The clients subsequently were prosecuted for contractor theft. One
client pleaded guilty to three misdemeanor counts of contractor theft,
and the case against the other was dismissed. The clients made full
restitution of all trust monies they had received.
The supreme court adopted the referee's conclusion that Winkel's
failure to obtain information about the trust funds held by the business
before the clients surrendered the funds to the bank constituted a
failure to do adequate preparation with respect to his representation of
the clients, in violation of SCR 20:1.1. The court further adopted the
conclusion that Winkel's failure to inform the clients about the risks
of criminal prosecution constituted a failure to explain the matter to
the clients to the extent reasonably necessary to permit them to make an
informed decision about the best use of the remaining business assets,
contrary to SCR 20:1.4(b).
In a second matter, Winkel represented a couple and their son in
estate planning. Winkel reviewed the trust agreement executed by the
husband that provided that upon his death, all of his assets would be
allocated to his wife's marital share unless she disclaimed all or part
of them. If no disclaimer were made, all of the assets would pass
directly to the wife and be included in her estate at her death.
When the husband died in February 1992, Winkel failed to recognize
the significance of the trust's disclaimer requirements and did not
perform the necessary analysis to advise the wife of the need for a
written disclaimer of her husband's assets. As a result, the estate of
the wife, who died in May 1993, had a potentially greater tax
liability.
Winkel subsequently claimed that he had prepared the necessary
disclaimer, but his files did not substantiate that he had done so. The
son found no indication in his records that his mother had executed a
disclaimer.
The son retained another attorney to represent him in estate matters.
Winkel did not respond to the attorney's request for the clients' estate
file, nor did Winkel respond to the initial letter from BAPR requesting
information. Winkel did not respond timely to a second letter from BAPR,
and did not respond to a telephone call from the district professional
responsibility committee investigator assigned to the matter. In
explaining his failure to respond to BAPR's inquiry, Winkel asserted
that he had undergone surgery and was taking pain medication. In fact,
Winkel had had two surgeries more than a year before receiving BAPR's
inquiry and had a third surgery not long after receiving it.
The supreme court adopted the referee's conclusion that Winkel's
failure to have the wife execute the necessary disclaimer under her
husband's trust constituted failure to provide the legal knowledge,
skill, thoroughness, and preparation reasonably necessary for competent
representation of the clients, contrary to SCR 20:1.1. The court further
adopted the conclusion that by misrepresenting that he had prepared the
disclaimer and misrepresenting the reason for his failure to respond to
BAPR's inquiries, Winkel engaged in conduct involving misrepresentation,
contrary to SCR 20:8.4(c).
In addition, the court adopted the conclusion that by failing to
respond to successor counsel's request for necessary estate information,
Winkel failed to keep a client reasonably informed of the status of a
matter and promptly comply with reasonable requests for information,
contrary to SCR 20:1.4(a). Finally, the court adopted the conclusion
that by failing to respond to BAPR's initial request for information and
subsequent contacts from BAPR and the district committee investigator,
Winkel failed to cooperate in the investigation of this matter, contrary
to SCR 21.03(4) and 22.07(2).
Winkel has received no prior discipline.
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