Case Title: Office of Lawyer Regulation v. Pamela J. Smoler

Citation: 

Docket Number: 2014AP000804-D

State: wisconsin

Court: Wisconsin Supreme Court

Date: 2015-10-30T00:00:00Z

Document:
2015 WI 97 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
 
CASE NO.: 
2014AP804-D 
COMPLETE TITLE: 
In the Matter of Disciplinary Proceedings  
Against  
Pamela J. Smoler, f/k/a Pamela J. Smelzer, 
Attorney at Law: 
 
Office of Lawyer Regulation, 
          Complainant, 
     v. 
Pamela J. Smoler f/k/a Pamela J. Smelzer, 
          Respondent. 
 
 
 
 
DISCIPLINARY PROCEEDINGS AGAINST SMOLER 
 
 
OPINION FILED: 
October 30, 2015 
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
      
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
      
 
COUNTY: 
      
 
JUDGE: 
      
 
 
 
JUSTICES: 
 
 
CONCURRED: 
      
 
DISSENTED: 
      
 
NOT PARTICIPATING:          
 
 
 
ATTORNEYS: 
 
 
 
 
 
 
 
 
2015 WI 97
NOTICE 
This opinion is subject to further 
editing and modification.  The final 
version will appear in the bound 
volume of the official reports.   
No.   2014AP804-D 
 
 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
In the Matter of Disciplinary Proceedings 
Against Pamela J. Smoler, f/k/a Pamela J. 
Smelzer, Attorney at Law: 
 
Office of Lawyer Regulation, 
 
          Complainant, 
 
     v. 
 
Pamela J. Smoler f/k/a Pamela J. Smelzer, 
 
          Respondent. 
 
FILED 
 
OCT 30, 2015 
 
Diane M. Fremgen 
Clerk of Supreme Court 
 
 
 
 
ATTORNEY 
disciplinary 
proceeding.  Attorney's 
license 
suspended.   
 
¶1 
PER CURIAM.   We review the report and recommendation 
of Referee Lisa C. Goldman that the license of Attorney Pamela 
J. Smoler, formerly known as Pamela J. Smelzer, be suspended for 
a period of nine months for professional misconduct and that she 
pay the full costs of this proceeding, which are $2,869.61 as of 
March 18, 2015.  The referee also recommended that Attorney 
Smoler be required to make restitution of $45,059.35 to one 
client. 
No. 
2014AP804-D   
 
2 
 
¶2 
Attorney Smoler failed to file an answer to the OLR's 
complaint, and she failed to appear or participate in the 
proceedings in any way.  Accordingly, we find it appropriate to 
declare her to be in default.  Upon careful review of the 
matter, we agree with the referee that Attorney Smoler's 
professional 
misconduct 
warrants 
a 
nine-month 
license 
suspension.  We further agree that she should be ordered to pay 
the full costs of this proceeding.  We also agree with the 
referee that a restitution award in the amount of $45,059.35 is 
appropriate.  Although the Office of Lawyer Regulation (OLR) has 
informed the court that there is no reasonably ascertainable 
amount for which a restitution award would be appropriate, the 
referee made findings of fact supporting a restitution award.  
There is no indication that those findings of fact are clearly 
erroneous. 
¶3 
Attorney Smoler was admitted to practice law in 
Wisconsin in 1988.  She currently resides in Florida.  Her 
license to practice law in Wisconsin was temporarily suspended 
on July 11, 2011, as a result of her willful failure to 
cooperate in an OLR investigation concerning her conduct.1  
Attorney Smoler's law license is also administratively suspended 
for failure to pay State Bar dues, failure to comply with 
continuing legal education requirements, and failure to file a 
                                                 
1 The OLR investigation at issue concerns the first client 
matter detailed in the complaint filed by the OLR in this case. 
No. 
2014AP804-D   
 
3 
 
trust account certification.  Attorney Smoler has no prior 
disciplinary history in Wisconsin. 
¶4 
On April 11, 2014, the OLR filed a complaint alleging 
that Attorney Smoler had engaged in seven counts of misconduct 
involving two client matters.  As noted, Attorney Smoler failed 
to file an answer to the complaint and failed to participate in 
the matter in any way.  On October 23, 2014, the OLR filed a 
motion 
for 
default 
judgment. 
 
The 
referee's 
report 
and 
recommendation was filed on February 27, 2015.  
¶5 
The 
first 
client 
matter 
detailed 
in 
the 
OLR's 
complaint involved Attorney Smoler's representation of D.S. and 
K.S. (collectively, the S.s).  The S.s hired Attorney Smoler to 
represent them in a medical malpractice claim for injuries K.S. 
suffered following surgery and treatment at the University of 
Wisconsin (UW) Hospital and Clinics.  Attorney Smoler filed a 
lawsuit on the S.s' behalf in October 2001, and in late 2003, a 
jury returned a verdict in their favor.   
¶6 
In 2005, Attorney Smoler asked the S.s if they would 
loan her $50,000 so that she could pursue a medical malpractice 
lawsuit on behalf of another client, C.J., that would be brought 
against one of the same doctors involved in the S.s' case.  The 
S.s agreed to loan the $50,000 to Attorney Smoler.  To 
memorialize the loan, Attorney Smoler drafted a document 
entitled "Loan/Promissory Note" which set forth the terms of the 
loan.  The loan called for five and one-half percent interest 
annually or statutory interest as awarded by the court.  The 
loan was for two years.  Attorney Smoler did not put any 
No. 
2014AP804-D   
 
4 
 
language in the note providing the S.s with an opportunity to 
speak with alternate counsel about the loan.  The loan was 
signed by the parties on August 31, 2005.  Attorney Smoler was 
paid $50,000 on September 13, 2005.  She deposited the money 
into her business checking account. 
¶7 
Two years passed without Attorney Smoler making a 
payment to the S.s on the loan.  The S.s agreed to extend the 
terms of the note one more year at Attorney Smoler's request.  
By October 2009, no payments had been made on the loan.  The S.s 
hired an attorney who demanded payment.  Attorney Smoler failed 
to pay the loan in response to a demand letter from the S.s' 
counsel.  
¶8 
The S.s filed a grievance with the OLR.  Attorney 
Smoler apologized for her inability to repay the loan, saying 
that her representation of the plaintiffs on a contingent fee 
basis had resulted in financial disaster for both her clients 
and herself.  
¶9 
On October 29, 2010, Attorney Smoler filed a voluntary 
petition 
for 
Chapter 
7 
bankruptcy 
in 
the 
United 
States 
Bankruptcy Court for the Western District of Wisconsin.  She 
listed the S.s as creditors.  Attorney Smoler was granted a 
bankruptcy discharge on March 28, 2012.  The discharge included 
the debt she owed to the S.s. 
¶10 As part of its investigation into the S.s' grievance, 
the OLR wrote to Attorney Smoler on December 15, 2010, and 
requested that she provide copies of her state and federal 
income tax returns for the years 2005 through 2009.  Attorney 
No. 
2014AP804-D   
 
5 
 
Smoler failed to respond.  On April 1, 2011, the OLR filed a 
notice of motion and motion requesting an order to show cause 
why Attorney Smoler's license should not be suspended for her 
willful failure to cooperate with the OLR's investigation of the 
S.s' grievance.  Attorney Smoler's license was temporarily 
suspended on July 11, 2011.  
¶11 The OLR's complaint alleged the following counts of 
misconduct with respect to Attorney Smoler's representation of 
the S.s: 
[Count 
One] 
 
By 
entering 
into 
the 
Loan 
transaction with the [S.s] without providing the [S.s] 
a reasonable opportunity to seek the advice of counsel 
in the transaction and without the [S.s] consenting in 
writing to the Loan, Smoler violated former [Supreme 
Court 
Rule 
(SCR)] 20:1.8(a),2 
effective 
prior 
to 
July 1, 2007. 
                                                 
2 Former SCR 20:1.8(a) (in effect prior to July 1, 2007) 
provides: 
A 
lawyer 
shall 
not 
enter 
into 
a 
business 
transaction with a client or knowingly acquire an 
ownership, possessory, security or other pecuniary 
interest adverse to a client unless: 
(1) the transaction and terms on which the lawyer 
acquires the interest are fair and reasonable to the 
client and are fully disclosed and transmitted in 
writing to the client in a manner which can be 
reasonably understood by the client; 
(2) the client is given a reasonable opportunity 
to seek the advice of independent counsel in the 
transaction; and 
(3) the client consents in writing thereto. 
No. 
2014AP804-D   
 
6 
 
[Count Two]  By failing to fully cooperate in 
OLR's investigation in the [S.] grievance matter, 
Smoler violated SCR 22.03(6).3 
¶12 The 
other 
client 
matter 
detailed 
in 
the 
OLR's 
complaint involved Attorney Smoler's representation of C.J. and 
her sister, C.H.  During the spring of 2005, C.J. and C.H. 
contacted Attorney Smoler regarding potential representation of 
C.J. in a medical malpractice claim against UW Hospital and 
Clinics.  Attorney Smoler requested an upfront fee concerning 
the initial risks of the suit, including to determine whether a 
notice of claim was timely filed and to find an expert witness 
willing to testify.  Attorney Smoler asked for $50,000, to be 
paid over six months.  She indicated that the money would be 
placed into her trust account.  The fee agreement provided that 
the client would be billed a flat fee of $50,000, which would 
cover, in part, attorneys fees and costs, to be paid in the 
following 
manner: 
$10,000 
prior 
to 
the 
start 
of 
the 
investigation, 
and 
the 
remainder 
$40,000 
no 
later 
than 
December 15, 2005.  C.J.'s father paid the $50,000 fee in two 
installments.  Both checks were deposited into Attorney Smoler's 
business account rather than her trust account. 
¶13 On October 25, 2005, C.J. gave her sister, C.H., power 
of attorney to act as her guardian and the authority to 
                                                 
3 SCR 22.03(6) provides that "[i]n the course of the 
investigation, the respondent's wilful failure to provide 
relevant information, to answer questions fully, or to furnish 
documents and the respondent's misrepresentation in a disclosure 
are misconduct, regardless of the merits of the matters asserted 
in the grievance." 
No. 
2014AP804-D   
 
7 
 
negotiate, manage, and make decisions related to the claims of 
C.J. against UW Hospital and Clinics and the treating physician.  
In January 2006, C.H. requested an update on the case from 
Attorney Smoler.  She again requested an update during a 
February 9, 2006 telephone conversation.   
¶14 On March 2, 2006, Attorney Smoler sent an invoice 
indicating that $4,940.65 had been spent in time and expenses.  
She failed to provide any other invoices regarding the case.  
Attorney Smoler filed a medical malpractice action on behalf of 
C.J. on March 8, 2007, in Dane County Circuit Court.  In early 
September 2007, C.H. tried to communicate with Attorney Smoler 
about the case.  Attorney Smoler updated C.H. by email and 
included a copy of an amended complaint.   
¶15 In September 2008, the case was dismissed on summary 
judgment against all defendants except one physician, who was 
ordered to pay $226.34.  The decision was later corrected and 
that doctor was also dismissed on summary judgment.  Attorney 
Smoler apparently did not immediately notify C.H. about the 
dismissal of her sister's lawsuit.  The trial court's decision 
was appealed, and the court of appeals affirmed the dismissal.  
Attorney Smoler failed to provide copies of filed documents when 
requested to do so.  She also failed to produce any statement of 
expenses or time billed on the file after the first and only 
bill was produced.  She failed to refund any of the $50,000 that 
C.J.'s family had paid as an advanced fee toward expenses and 
hourly billing.   
No. 
2014AP804-D   
 
8 
 
¶16 C.J. filed a grievance with the OLR, and Attorney 
Smoler was asked to respond but failed to do so.   
¶17 The OLR's complaint set forth the following counts 
with respect to Attorney Smoler's representation of C.J. and 
C.H.: 
[Count Three]  By failing to provide copies of 
relevant documentation to [C.J.] or [C.H.], and by 
failing to respond to various requests for information 
received from [C.J.] or [C.H.] concerning the status 
of her case, Smoler violated [former] SCR 20:1.4(a),4 
effective 
prior 
to 
July 
1, 
2007, 
and 
current 
SCR 20:1.4(a)(3) and (4).5 
[Count Four]  By failing to respond to [C.J.'s] 
or [C.H.'s] requests for information concerning fees 
and expenses and by failing to provide periodic 
written statements or accountings concerning fees and 
expenses 
to 
[C.J.] 
or 
[C.H.], 
Smoler 
violated 
SCR 20:1.5(b)(3),6 
[former] 
SCR 20:1.15(d)(1),7 
                                                 
4 Former SCR 20:1.4(a) (in effect prior to July 1, 2007) 
provides that "[a] lawyer shall keep a client reasonably 
informed about the status of a matter and promptly comply with 
reasonable requests for information." 
5 SCR 20:1.4(a)(3) and (4) provide that a lawyer shall "keep 
the client reasonably informed about the status of the matter" 
and "promptly comply with reasonable requests by the client for 
information." 
6 SCR 20:1.5(b)(3) provides that "[a] lawyer shall promptly 
respond to a client's request for information concerning fees 
and expenses." 
7 Former SCR 20:1.15(d)(1) (in effect prior to July 1, 2007) 
provides: 
Upon receiving funds or other property in which a 
client has an interest, or in which the lawyer has 
received notice that a 3rd party has an interest 
identified by a lien, court order, judgment, or 
contract, the lawyer shall promptly notify the client 
(continued) 
No. 
2014AP804-D   
 
9 
 
effective 
prior 
to 
July 
1, 
2007, 
and 
SCR 20:1.15(d)(2).8 
[Count Five]  By failing upon termination of 
representation, to surrender papers and property to 
which [C.J.] was entitled and by failing to refund any 
advanced payment of fee or expense that had not been 
earned or incurred, Smoler violated SCR 20:1.16(d).9 
[Count Six]  By failing to deposit a portion of 
the $50,000 received for [C.J.'s] malpractice claim to 
cover costs associated with the representation into a 
client 
trust 
account, 
Smoler 
violated 
[former] 
SCR 20:1.15(b)(4),10 effective prior to July 1, 2007. 
                                                                                                                                                             
or 3rd party in writing.  Except as stated in this 
rule or otherwise permitted by law or by agreement 
with the client, the lawyer shall promptly deliver to 
the client or 3rd party any funds or other property 
that the client or 3rd party is entitled to receive. 
8 SCR 20:1.15(d)(2) provides that "[u]pon final distribution 
of any trust property or upon request by the client or a 3rd 
party having an ownership interest in the property, the lawyer 
shall promptly render a full written accounting regarding the 
property." 
9 SCR 20:1.16(d) provides:  
Upon termination of representation, a lawyer 
shall take steps to the extent reasonably practicable 
to protect a client's interests, such as giving 
reasonable notice to the client, allowing time for 
employment of other counsel, surrendering papers and 
property to which the client is entitled and refunding 
any advance payment of fee or expense that has not 
been earned or incurred. The lawyer may retain papers 
relating to the client to the extent permitted by 
other law. 
10 Former SCR 20:1.15(b)(4) (in effect prior to July 1, 
2007) provides, "Unearned fees and advanced payments of fees 
shall be held in trust until earned by the lawyer, and withdrawn 
pursuant to SCR 20:1.15 (g).  Funds advanced by a client or 3rd 
party for payment of costs shall be held in trust until the 
costs are incurred." 
No. 
2014AP804-D   
 
10 
 
[Count Seven]  By failing to respond to OLR's 
requests for a written response to the investigation, 
Smoler violated SCR 22.03(2).11 
¶18 Referee Goldman was appointed on July 28, 2014.  In 
her report and recommendation, the referee concluded that the 
OLR proved all seven counts in its complaint by clear and 
convincing evidence.  In discussing the appropriate sanction, 
the referee noted that Attorney Smoler apparently practiced at a 
very competent and accomplished level for many years.  The 
referee said, "No facts of record explain her sad story.  It is 
as though she imploded all at once, without warning, and without 
reason."  The referee went on to comment, "For an attorney with 
an otherwise unblemished record, Smoler's slide into the dark 
side seems incredibly unfortunate.  . . . .  Smoler's failure in 
general to supply information to OLR in the course of the 
investigation into both client matters does not help the 
situation and only further indicates her inability to function 
at a very basic level." 
                                                 
11 SCR 22.03(2) provides: 
Upon commencing an investigation, the director 
shall notify the respondent of the matter being 
investigated unless in the opinion of the director the 
investigation of the matter requires otherwise.  The 
respondent shall fully and fairly disclose all facts 
and circumstances pertaining to the alleged misconduct 
within 20 days after being served by ordinary mail a 
request for a written response.  The director may 
allow additional time to respond.  Following receipt 
of the response, the director may conduct further 
investigation and may compel the respondent to answer 
questions, 
furnish 
documents, 
and 
present 
any 
information deemed relevant to the investigation. 
No. 
2014AP804-D   
 
11 
 
¶19 The 
referee 
concluded 
that 
Attorney 
Smoler's 
combination of multiple violations involving a failure to return 
client money and her unwillingness to participate in the 
investigation into her misconduct warranted a suspension longer 
than six months.  The referee concluded that a nine-month 
suspension would impress upon Attorney Smoler the seriousness of 
her misconduct and would deter other attorneys from committing 
similar misconduct.  The referee further recommended that 
Attorney Smoler be required to pay the full costs of the 
proceeding. 
¶20 With respect to restitution, the referee noted that 
the S.s' loan was discharged by the Western District of 
Wisconsin 
bankruptcy 
court, 
so 
no 
restitution 
would 
be 
appropriate regarding the loan that the S.s made to Attorney 
Smoler.  With respect to the $50,000 paid to Attorney Smoler by 
C.J.'s family, the referee said that requiring Attorney Smoler 
to pay restitution would further safeguard the public and would 
further impress upon Attorney Smoler the seriousness of her 
misconduct.  The referee noted that Attorney Smoler failed to 
account for any of the funds paid by C.J.'s family except the 
$4,940.65 indicated in the March 2, 2006 invoice.  Accordingly, 
the referee recommended that Attorney Smoler be required to pay 
$45,059.35 in restitution to C.J.  The referee said it was 
unclear whether the OLR intended to seek restitution for C.J. 
and the referee said that the OLR should be afforded discretion 
to reduce the amount of restitution based on information it may 
have. 
No. 
2014AP804-D   
 
12 
 
¶21 On March 18, 2015, the OLR submitted a restitution 
statement saying it was not seeking restitution in either the S. 
matter or the C.J. matter.  With respect to the S. matter, the 
OLR noted that the S.s' loan to Attorney Smoler was fully 
discharged by a bankruptcy court.  With respect to the C.J. 
matter, the OLR said its director determined that there was no 
reasonably ascertainable amount for which a restitution award 
would be appropriate.   
¶22 A referee's findings of fact are affirmed unless 
clearly erroneous.  See In re Disciplinary Proceedings Against 
Eisenberg, 2004 WI 14, ¶5, 269 Wis. 2d 43, 675 N.W.2d 747.  We 
review the referee's conclusions of law de novo.  Id.  We 
determine the appropriate level of discipline independent of the 
referee's recommendation.  See In re Disciplinary Proceedings 
Against Widule, 2003 WI 34, ¶44, 261 Wis. 2d 45, 660 N.W.2d 686.   
¶23 We conclude that Attorney Smoler should be declared in 
default.  Although she was personally served with the complaint 
and was given notice of all other proceedings, she failed to 
appear or present a defense.  Accordingly, we deem it 
appropriate to declare her in default.   
¶24 We agree with the referee that the allegations in the 
OLR's complaint have been established and that Attorney Smoler 
engaged in the seven counts of misconduct alleged in the 
complaint.  We further agree with the referee that a nine-month 
suspension of Attorney Smoler's license to practice law is an 
appropriate sanction for her misconduct.  Although no two fact 
situations are identical, a nine-month suspension is generally 
No. 
2014AP804-D   
 
13 
 
consistent with the sanctions imposed in somewhat analogous 
cases.  For example, in In re Disciplinary Proceedings Against 
Pitts, 2007 WI 112, 304 Wis. 2d 556, 735 N.W.2d 917, an 
attorney's license was suspended for six months for ten counts 
of misconduct including entering into a business transaction 
with a client without giving her a reasonable opportunity to 
seek the advice of independent counsel, reducing the loan to 
writing, or obtaining the client's written consent to the loan.  
The attorney in Pitts loaned $1,000 to his client.  By contrast, 
Attorney Smoler borrowed large sums of money from her clients.  
In In re Disciplinary Proceedings Against Phillips, 2006 WI 43, 
290 Wis. 2d 87, 713 N.W.2d 629, an attorney's license was 
suspended for one year for seven counts of misconduct including 
borrowing $145,000 from a client without giving the client a 
reasonable opportunity to seek the advice of independent 
counsel, failing to provide the terms of the loan to the client 
in an understandable writing, and failing to obtain the client's 
written consent to the transaction.  The conduct at issue in the 
instant case seems to fall somewhere between the Pitts and 
Phillips cases.  Accordingly, we find it appropriate to suspend 
Attorney Smoler's license for nine months. 
¶25 We also agree with the referee that Attorney Smoler 
should be required to pay the full costs of the proceeding.  
With respect to restitution, we agree with the referee that 
Attorney Smoler should be required to pay $45,059.35 to C.J.  
Although the OLR said that there was not presently a reasonably 
ascertainable amount of restitution owed to C.J., the referee 
No. 
2014AP804-D   
 
14 
 
made explicit factual findings showing that Attorney Smoler owes 
C.J. $45,059.35.  Those findings of fact have not been shown to 
be clearly erroneous and, accordingly, we adopt them.  Since 
Attorney Smoler's debt to the S.s was discharged in bankruptcy, 
we make no restitution award in that matter. 
¶26 IT IS ORDERED that the license of Pamela J. Smoler to 
practice law in Wisconsin is suspended for a period of nine 
months, effective the date of this order. 
¶27 IT IS FURTHER ORDERED that within 60 days of the date 
of this order, Pamela J. Smoler shall pay restitution to C.J. in 
the amount of $45,059.35. 
¶28 IT IS FURTHER ORDERED that within 60 days of the date 
of this order, Pamela J. Smoler shall pay to the Office of 
Lawyer Regulation the costs of this proceeding, which are 
$2,869.61. 
¶29 IT IS FURTHER ORDERED that the restitution specified 
above is to be completed prior to paying costs to the Office of 
Lawyer Regulation. 
¶30 IT IS FURTHER ORDERED that, to the extent she has not 
already done so, Pamela J. Smoler shall comply with the 
provisions of SCR 22.26 concerning the duties of an attorney 
whose license to practice law has been suspended. 
¶31 IT IS FURTHER ORDERED that compliance with all 
conditions of this order is required for reinstatement.  See 
SCR 22.29(4)(c). 
No. 
2014AP804-D   
 
15 
 
¶32 IT IS FURTHER ORDERED that the temporary suspension of 
Pamela J. Smoler's license to practice law in Wisconsin issued 
on July 11, 2011, is hereby lifted.  
All work on this opinion was completed prior to Justice 
Rebecca G. Bradley joining the court. 
 
 
 
No. 
2014AP804-D   
 
 
 
1