Wisconsin Lawyer
Vol. 75, No. 11, November
2005
Regulating the Profession:
Office of Lawyer Regulation - Annual Report 2004-2005
Sidebars:
by the Board of Administrative Oversight & Office of Lawyer
Regulation
The Office of Lawyer Regulation (OLR) and Board of Administrative
Oversight (board) file annually with the Wisconsin Supreme Court a
report on the lawyer regulation system. This is the fifth report filed
under the new regulation system, which became effective on Oct. 1, 2000.
This past year, the system met standards on intake evaluations,
maintained pace with formal grievance investigations, and increased the
number of matters pending in litigation. Progress was made on several
important policy issues, including trust account rule amendments,
timeliness of proceedings in cases involving interim suspensions,
assessment of costs in disciplinary cases, and management of district
committee investigations. Finally, the Professional Discipline
Compendium became available online, providing free public access through
the OLR Web site, at www.wiscourts.gov/olr.
Lawyer Regulation System Overview
The Wisconsin Supreme Court created the lawyer regulation system to
carry out the court's constitutional responsibility to supervise the
practice of law and protect the public from misconduct by persons
practicing law in Wisconsin. Figure
1 shows the composition and organization of the lawyer regulation
system. The court has adopted standards of professional conduct for
attorneys. The court confers the privilege to practice law on an
attorney conditioned on his or her compliance with those
standards.1 A failure to comply with the
court's standards may constitute misconduct or may be evidence of a
medical problem.
The OLR director is required to investigate any possible misconduct
or medical incapacity of an attorney licensed to practice in
Wisconsin.2 Communications with the OLR
alleging lawyer misconduct are privileged, and no lawsuit predicated on
those communications may be instituted against any grievant or
witness.3 Attorneys and grievants may
consult with and be represented by counsel at any stage of an
investigation. Before the filing of a formal complaint or petition, all
papers, files, transcripts, and communications in an OLR investigation
must be kept confidential by the OLR.4 The
OLR may, however, provide relevant information to the respondent and the
grievant.5 Although the Supreme Court Rules
provide no sanction for disclosure of a grievance by the respondent or
the grievant, the OLR requests that those involved in an OLR
investigation keep confidential all documents generated by the
investigation.
Initially, the OLR staff screens all inquiries and grievances
concerning attorney conduct. If the allegations made are not within the
OLR's jurisdiction, or if the allegations are not supported by a
sufficient factual basis, staff will close the file. The grievant may
make a written request for the director's review of the closure. The
director's decision is final. After preliminary evaluation, staff also
may forward the matter to another agency; attempt to reconcile the
matter between the grievant and attorney if the dispute is minor; or
refer the matter to the director for diversion or investigation. Before
or after investigation, the director may divert the matter to an
alternatives to discipline program, if nothing more than minor
misconduct is involved, the respondent agrees, and the respondent is
eligible to participate. Alternatives to discipline are usually
educational programs or monitoring arrangements that help an attorney
improve the quality of his or her practice.
If the grievance sets forth sufficient information to support an
allegation of a violation of SCR chapter 20, OLR staff may initiate an
investigation. The OLR staff will send a letter to the respondent,
enclosing the grievance and requesting a response within 20 days. In
most instances, staff will forward the attorney's response to the
grievant for comments. When the OLR staff has completed the preliminary
investigation, the director will determine whether: 1) an uncontested
violation exists; 2) the grievance should be dismissed for lack of
merit; 3) further staff investigation is needed; or 4) the matter should
be assigned to a district investigative committee for further
investigation, pursuant to SCR 22.04(1).
If the grievance is further investigated by staff or a district
committee, the respondent and the grievant will be kept advised about
the investigation. The committee chair can assign the matter to one of
the committee's investigators. Pursuant to SCR 22.04(2), the respondent
may request a substitution of a district committee investigator within
14 days of receiving notice of the assignment of the investigator. The
respondent shall be granted one such substitution as a matter of right,
and any other requests for substitution shall be granted by the
committee chair for good cause shown. If the committee decides to take
sworn testimony regarding a grievance at an investigative meeting, the
respondent and the grievant will receive timely notice of the meeting.
Committee members elicit pertinent information from witnesses at such a
meeting. For each matter referred to committee, the committee will
prepare a report summarizing the facts and potential disciplinary
violations. That report will be sent to the respondent and the grievant
for comment.
After the investigation is completed by staff and/or a committee, the
director may dismiss the matter for lack of sufficient evidence of cause
to proceed, divert the matter to an alternatives to discipline program,
obtain the respondent's consent to a private or public reprimand, or
present the matter to the Preliminary Review Committee (PRC) for a
determination of whether there is cause to proceed. In cases in which
the director dismisses the matter, the grievant has 30 days after
receiving written notice of the dismissal to make a written request for
review of the decision by the PRC. The decision of the PRC is final.
If, after the investigation is completed, the director does not
dismiss the grievance, seek a consent reprimand, or divert the matter,
the OLR staff will prepare an investigative report and provide copies to
the grievant and the respondent for comment. (In cases in which a
district committee investigates a matter, its report will serve as the
investigative report.) The grievant and the respondent may submit
written responses to the report within 10 days after they receive the
report.
The director may then submit the results of the investigation to the
PRC. The PRC determines whether the evidence presented supports a
reasonable belief that an attorney has engaged in misconduct or has a
medical incapacity that may be proved by clear, satisfactory, and
convincing evidence.6 If the PRC
dismisses the matter, the grievant has 30 days after being notified of
the dismissal to file a written request for review of that decision. The
supreme court will select a referee to review the matter, and the
referee's decision is final.
If the PRC determines that the director has established cause to
proceed, the director may file a complaint with the supreme court
alleging misconduct. The OLR, rather than the grievant, is the
complainant in such a matter. If the director files a complaint, an
answer is required within 20 days of service of the complaint. Upon
proof of service, the supreme court appoints a referee to hear the
matter pursuant to SCR 22.13(3). The referee holds a scheduling
conference to define the issues and to determine the extent of
discovery. The referee then presides at a public hearing that is
conducted as a trial of a civil action to the court.7 The OLR must prove misconduct or medical
incapacity by clear, satisfactory, and convincing evidence.8
Within 30 days after the hearing concludes, the referee must submit
his or her report to the supreme court, including findings of fact,
conclusions of law, and a recommendation of dismissal or imposition of
discipline. The OLR or a respondent may file an appeal of the referee's
report within 20 days after the report is filed. If no appeal is timely
filed, the supreme court reviews the referee's report and determines
appropriate discipline in cases of misconduct and appropriate action in
cases of medical incapacity. The court may, on its own motion, order the
parties to file briefs. Either the respondent or the OLR may file a
motion for reconsideration of the supreme court's decision within 20
days of the filing of the court's decision. The filing of a motion for
reconsideration does not stay enforcement of the judgment. The supreme
court's final dispositions of disciplinary and medical incapacity
proceedings are published in the Wisconsin Reports and in the
Wisconsin Lawyer.
The Year in Review
Significant Lawyer Regulation System Developments.
The system maintained pace with its caseload this year. At the end of
the fiscal year, there were a total of 393 formal investigations, up
from 389 at the end of last year. Central intake maintained its
timeliness standards throughout the year. The number of formal
investigations pending over 11 months remains high. Special efforts will
be made this year to achieve timeliness standards for formal
investigations.
The average processing time for intake matters improved from 60 days
last year to 54 days this year; this is an appropriate amount of time.
The average processing time for formal investigations improved from 426
days last year to 391 days this year; this must be improved. Overall
average processing time improved from 185 days last year to 170 days
this year.
The percentage of matters completed within 90 days increased from 64
percent last year to 71 percent this year. The percentage of matters
completed within 180 days increased from 76 percent last year to 81
percent this year.
The supreme court met with the Board of Administrative Oversight, the
PRC, special investigators, and the Special Preliminary Review Panel on
April 6, 2005, to discuss current developments in the lawyer regulation
system. This year, the court heard a petition by the Wisconsin Ethics
2000 Committee for changes to the Rules of Professional Conduct for
Attorneys. The court also established time limits in interim suspension
cases, and improved the management and operations of the district
committees.
The PRC re-elected attorneys James Wickhem, Janesville, chair, and
James Friedman, Milwaukee, vice chair. The PRC has considered whether
cause to proceed existed in 421 matters and has reviewed the director's
dismissals in 11 matters. The PRC met quarterly during the year and will
continue to meet quarterly.
The Board of Administrative Oversight re-elected attorneys William H.
Levit Jr., Milwaukee, chair, and Ann Ustad Smith, Madison, vice chair.
The board met quarterly and considered and made recommendations
concerning the assessment of costs in disciplinary cases and the
timeliness of proceedings in interim suspension cases. The board
continues to monitor carefully the processing of matters and the
effective use of district committees.
The board assesses perceptions of the regulation system through a
questionnaire that is sent to each grievant and each respondent after
the grievance is resolved. The response rate is approximately 8 percent
for grievants and 11 percent for respondents. While perceptions
generally relate to the grievance outcome, the questionnaire responses
provide helpful information. The board will continue to monitor trends
in these perceptions.
The district committees continue to make a valuable contribution to
the system and were instrumental in resolving matters requiring a depth
and breadth of legal and other professional expertise. While referring
matters to committee involves a significant commitment of time and
talent, the results are beneficial and worth the commitment.
Improvements in training and in the management of cases have increased
their effectiveness. This year, the court increased the composition of
public members on the committees from one-third to two-fifths. The
chairs met with the director in May to discuss improvements in
operations.
Special investigators and the Special Preliminary Review Panel
process matters involving allegations against attorneys who serve with
the regular components of the regulation system. During Fiscal 2005,
special investigators received 33 matters and resolved 38 matters. The
Special Preliminary Review Panel considered no matters for cause and
seven matters on review.
The alternatives to discipline program provides an effective way to
improve an attorney's ability to practice in accordance with high
professional standards. Frequently, this is a more effective measure
than professional discipline. The court has authorized diversion to an
alternative program in situations in which the program will likely
benefit the attorney and in which the attorney will not likely harm the
public. Alternative programs may include mediation, fee arbitration, law
office management assistance, evaluation and treatment for alcohol and
other substance abuse, psychological evaluation and treatment, medical
evaluation and treatment, monitoring of practice or trust account
procedures, continuing legal education, ethics school, and the
multistate professional responsibility examination. During the fiscal
year, 85 attorneys were diverted to alternative programs and 102
attorneys completed diversions.
The central intake program receives inquiries and grievances
concerning attorney conduct and provides preliminary evaluation of
grievances before any formal investigation. Inquiries and grievances may
be received by telephone; callers may use a toll-free number to contact
the OLR. After the preliminary evaluation, the central intake staff may
forward the matter to another appropriate agency, attempt to reconcile
the matter if it is a minor dispute, close the matter if it does not
present sufficient information to support an ethical allegation, or
refer the matter for investigation or diversion to an alternative to
discipline.
Central intake received 2,105 inquiries and grievances. There has
been an average 4 percent decrease in the number of grievances filed in
each of the last three fiscal years. Of the matters evaluated in central
intake this fiscal year, approximately 18 percent were forwarded for
formal investigation; 10 percent involved the resolution of minor
disputes or grievances that were withdrawn; 5 percent involved diversion
programs; and the remaining 67 percent were closed for lack of
sufficient information to suggest an allegation of potential ethical
misconduct.
Overdraft Notification Program
The Overdraft Notification Rule9 went
into effect on Jan. 1, 1999. That rule requires attorneys to authorize
their financial institutions to notify the OLR of overdrafts on their
client trust accounts and fiduciary accounts. Information regarding the
trust account overdraft program is available from the OLR Web page,
www.wicourts.gov/olr.
During Fiscal 2005, 104 overdrafts were reported to the OLR, 28 fewer
than the previous fiscal year. Overdraft notifications have resulted in
the following dispositions during this year: five month
suspension10 - 1; temporary suspension for
noncooperation11 - 1; diversion - 15;
dismissal after diversion program successfully completed - 12; dismissal
after investigation - 8; dismissal after investigation/advisory letter
sent - 37; closed without investigation/collection account exception -
2; closed without investigation/real estate exception/advisory letter
sent - 1; closed without investigation/bank errors - 19; closed without
investigation/bank errors/advisory letter sent - 3; closed pending
reinstatement proceedings - 1.
The advisory letters sent during Fiscal 2005, some of which included
more than one advisory, related to the following issues and record
keeping deficiencies: availability of funds for disbursement - 12; bank
procedures/delays in posting transactions - 3; maintenance account (to
cover bank charges) - 4; deposit slip errors - 1; lack of proper
endorsement - 6; signatory authority on trust accounts - 2; failure to
maintain canceled checks - 10; transaction register/subsidiary ledger
deficiencies - 36; check stubs/inadequacy as a transaction register - 4;
computer software deficiencies - 2; commingling - 2; prohibition against
electronic transactions (credit card/telephone/internet) - 3; other -
6.
The OLR staff presented two half-day seminars on trust account
management in conjunction with diversions. Trust account management also
was covered at the OLR's Professionalism Seminar, another diversion
program, on Nov. 5, 2004. The OLR's trust account program administrator
also presented several CLE programs regarding the new trust account
rule. Finally, during the year, the OLR director and trust account
program administrator worked with the State Bar in drafting proposed
amendments to the new trust account rule.
Survey of Matters
Overall Processing. The pending caseload is 855
matters, up from the prior year, consistent with an increase of matters
in litigation, and within the system's caseload capacity of about 870
matters. The efficiency with which matters are processed is very good.
The average processing time was 170 days, faster than last year and
better than the five-year average. Also, the percentage of matters
resolved within 90 days and 180 days increased, to 71 percent and 81
percent respectively, and should increase again next year.
Grievances. Figure
2 breaks down by category the grievances received between July 1,
2004 and June 30, 2005. In describing the nature of the grievances, only
the most serious allegation is reflected. While most grievances allege
more than one act of misconduct, it is not practical to list all
allegations.
The allegations most commonly made in grievances were lack of
diligence by the lawyer entrusted with the legal matter, lack of
communication with the client, and misrepresentation or dishonesty. The
two areas of practice that produced the most grievances during the year
were criminal law and family law. It is important to point out that
while clients file the majority of grievances, anyone can file a
grievance. (See Figure
2.)
Discipline. In Fiscal 2005, 39 attorneys received
public disciplinary sanctions. The supreme court imposed two
revocations, four revocations by consent, 17 suspensions, 19 temporary
suspensions, two summary suspensions, one medical suspension, and 11
public reprimands, and dismissed two disciplinary matters. Referees
issued four public reprimands by consent. At the end of the year, 148
formal disciplinary matters were pending in the supreme court, up from
52 last year. Figure
3 shows the numbers and percentages of attorneys receiving public
discipline since Fiscal 1979. Figure
4 shows the types of misconduct found in public discipline
decisions.
A referee has authority, under SCR 22.09(3), to issue private
reprimands pursuant to an agreement between the director and the
attorney. Typically, a private reprimand is imposed for an isolated act
of misconduct that caused relatively minor harm. A private reprimand is
not imposed if public disclosure of the attorney's misconduct is
necessary to protect the public. Private reprimands are retained
permanently and may be considered as an aggravating factor on the issue
of sanctions if the attorney commits subsequent misconduct. Summaries of
private reprimands, without any reference to or identification of the
attorney involved, are printed twice a year in the Wisconsin
Lawyer.
During this fiscal year, 16 attorneys received private reprimands.
The supreme court issued four private reprimands. Eighty-five attorneys
entered the new alternatives to discipline program and 102 attorneys
completed an alternative program.
Other dispositions included: matters closed after the initial intake
evaluation due to insufficient information to support a misconduct
allegation (1,653); dismissals after investigation in cases due to
insufficient evidence of a violation (80); dismissals with an advisory
letter (54); and matters closed pending petition for reinstatement
(15).
Reinstatements. During Fiscal 2005, the court
completed action on 26 reinstatement petitions (22 administrative and
four disciplinary).
Finances
The legal profession is unique in assuming all costs for regulating
itself. An assessment on every member of the State Bar of Wisconsin pays
the costs and expenses of the lawyer regulation system, including all
the costs and expenses of the OLR, district committees, the PRC, and the
board. To help offset the costs, the OLR collects costs from attorneys
disciplined in formal court proceedings and collects fees on petitions
for reinstatement. Collections for Fiscal 2005 were approximately
$171,761.40.
The budget for Fiscal 2006 is $2,413,000, up from $2,398,000 last
year. The assessment is $132.66, the same as last year. The assessment
is in line with those of neighboring jurisdictions. The assessment is
significantly lower than in Colorado, which has a comparable lawyer
population and similar programs.
Public Information and Outreach
To promote understanding of and confidence in the lawyer regulation
system, public information and outreach efforts are ongoing. General
information about the lawyer regulation system is available at
www.wicourts.gov/olr.
The Year Ahead
The lawyer regulation system will make special efforts to achieve its
timeliness goals for formal investigations. Significant work will
continue toward improvements in ethics rules and system procedures.
During the year, the supreme court will give considerable attention to
the proposals of the Wisconsin Ethics 2000 Committee and may order
significant changes in the rules sometime during the year.
Endnotes
1SCR 21.15(2).
2SCR 21.03(6)(a).
3SCR 21.19.
4SCR 22.40(1).
5SCR 22.40(2).
6SCR 22.001(2).
7SCR 22.16.
8SCR 22.38.
9SCR 20:1.15(h), formerly SCR
20:15(i) - (p).
10Included condition of two years
of trust account supervision following reinstatement.
11Due to database error, this
suspension was not included in the FY 2004 OLR Annual Report. It is
included here to address that omission.
Wisconsin
Lawyer