Title: Office of Lawyer Regulation v. Mary K. Biester

State: wisconsin

Issuer: Wisconsin Supreme Court

Document:

2016 WI 74 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
 
CASE NO.: 
2012AP385-D 
COMPLETE TITLE: 
In the Matter of Disciplinary Proceedings 
Against Mary K. Biester, Attorney at Law: 
 
Office of Lawyer Regulation, 
          Complainant, 
     v. 
Mary K. Biester, 
          Respondent. 
 
 
 
 
DISCIPLINARY PROCEEDINGS AGAINST BIESTER 
 
 
OPINION FILED: 
July 22, 2016 
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
      
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
      
 
COUNTY: 
      
 
JUDGE: 
      
 
 
 
JUSTICES: 
 
 
CONCURRED: 
ABRAHAMSON, J. concurs (Opinion filed). 
 
DISSENTED: 
      
 
NOT PARTICIPATING:          
 
 
 
ATTORNEYS: 
 
 
 
 
 
 
 
 
 
2016 WI 74
NOTICE 
This opinion is subject to further 
editing and modification.  The final 
version will appear in the bound 
volume of the official reports.   
No.  2012AP385-D 
 
 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
In the Matter of Disciplinary Proceedings 
Against Mary K. Biester, Attorney at Law: 
 
Office of Lawyer Regulation, 
 
          Complainant, 
     v. 
 
Mary K. Biester, 
 
          Respondent. 
 
FILED 
 
JUL 22, 2016 
 
Diane M. Fremgen 
Clerk of Supreme Court 
 
 
 
 
ATTORNEY disciplinary proceeding.    Attorney's license 
suspended.   
 
¶1 
PER CURIAM.    We review the report filed by Referee 
Dennis J. Flynn recommending the court suspend Attorney Mary K. 
Biester's license to practice law in Wisconsin for the maximum 
period allowed for multiple violations of supreme court rules, 
including converting client funds.  Since no appeal has been 
filed, we review the referee's report and recommendation 
pursuant to Supreme Court Rule (SCR) 22.17(2).  Upon careful 
review of the matter, we adopt the referee's findings of fact 
and conclusions of law.  We conclude, however, that rather than 
No. 
2012AP385-D   
 
2 
 
suspending Attorney Biester's license for the maximum period 
allowed, a three year and six month suspension of her license is 
an appropriate sanction.  Because we noted in our previous order 
imposing a one year suspension that any sanction imposed as a 
result of an additional finding of misconduct shall run 
consecutive to the one year suspension, we deem it appropriate 
to make the three year and six month suspension retroactive to 
November 25, 2014, one year after the previous suspension was 
imposed.  We also agree with the referee that Attorney Biester 
should be required to make restitution to the Wisconsin Lawyers' 
Fund for Client Protection and that she should pay the full 
costs of this proceeding, which were $8,712.86 as of December 
18, 2015.   
¶2 
Attorney Biester was admitted to practice law in 
Wisconsin in 1979 and practiced in Beloit.  As previously noted, 
on November 25, 2013, her license to practice law in Wisconsin 
was suspended for one year.  The suspension arose out of 30 
counts of misconduct involving six clients.  The misconduct 
included failing to act with reasonable diligence and promptness 
in representing a client; failing to keep the client reasonably 
informed about the status of the matter; failing to explain a 
matter to the extent reasonably necessary to permit the client 
to 
make 
informed 
decisions 
regarding 
the 
representation; 
engaging in conduct involving dishonesty, fraud, deceit or 
misrepresentation; 
multiple 
trust 
account 
violations; 
and 
failing to cooperate in the investigation of a grievance filed 
with the Office of Lawyer Regulation (OLR).  In re Disciplinary 
No. 
2012AP385-D   
 
3 
 
Proceedings against Biester, 2013 WI 85, 350 Wis. 2d 707, 838 
N.W.2d 79.  Her license remains suspended.   
¶3 
This disciplinary proceeding involves Count Two of the 
OLR's amended complaint, the only count that was not addressed 
in the 2013 decision.  Count Two of the amended complaint 
involved Attorney Biester's representation of L.T.  L.T. hired 
Attorney Biester to represent her in a divorce matter in 2008.  
Attorney Biester was experiencing financial problems at that 
time, and her home was the subject of a foreclosure action.  
L.T. had inherited a large sum of money, and Attorney Biester 
advised L.T. she should protect those funds from her husband.  
In February 2009, Attorney Biester's nonlawyer assistant, J.M., 
convinced L.T. to transfer $78,000 of her inherited funds into 
Attorney 
Biester's 
client 
trust 
account 
for 
safekeeping.  
Attorney Biester wire transferred $78,000 from her client trust 
account to the bank that held the first mortgage on Attorney 
Biester's home.  Count Two of the OLR's amended complaint 
alleged the following violations of supreme court rules: 
COUNT TWO 
(Multiple Rule Violations) 
 
24(a).  While representing L.T. at the time 
Biester deposited and then disbursed funds belonging 
to L.T. from her client trust account to pay off her 
personal 
mortgage 
with 
Associated 
Bank, 
Biester 
represented a client when the representation of that 
client 
was 
materially 
limited 
to 
Biester's 
responsibilities to a third person or by her own 
No. 
2012AP385-D   
 
4 
 
personal 
interest, 
all 
in 
violation 
of 
SCR 
20:1.7(a)(2).1 
 
24(b).  By failing until August 24, 2009, to 
inform L.T. that her funds had been deposited and 
disbursed from the client trust account and in failing 
to keep L.T. reasonably informed about the status of 
her legal matter, Biester violated SCR 20:1.4(a)(3).2 
 
24(c).  With knowledge of a court order limiting 
the transfer of property in the divorce action, and in 
failing to inform L.T. and the Court that L.T.'s funds 
had been deposited in Biester's client trust account 
and then transferred out of the client trust account 
to pay Biester's personal mortgage, Biester disobeyed 
an obligation under the rules of a tribunal, in 
violation of SCR 20:3.4(c).3 
 
24(d).  By depositing funds belonging to L.T. 
into her client trust account and converting those 
funds 
for 
the 
purpose 
of 
paying 
her 
mortgage 
obligation and in failing to inform her client and the 
Court of these events, Biester engaged in conduct 
involving 
dishonesty, 
fraud, 
deceit, 
or 
misrepresentation, in violation of SCR 20:8.4(c).4 
                                                 
1 SCR 20:1.7(a)(2) provides:  "Except as provided in par. 
(b), a lawyer shall not represent a client if the representation 
involves a concurrent conflict of interest.  A concurrent 
conflict of interest exists if there is a significant risk that 
the representation of one or more clients will be materially 
limited by the lawyer's responsibilities to another client, a 
former client or a third person or by a personal interest of the 
lawyer."  
2 SCR 20:1.4(a)(3) provides:  "A lawyer shall keep the 
client reasonably informed about the status of the matter."   
3 SCR 20:3.4(c) provides:  "A lawyer shall not knowingly 
disobey an obligation under the rules of a tribunal, except for 
an open refusal based on an assertion that no valid obligation 
exists."   
4 SCR 20:8.4(c) provides:  "It is professional misconduct 
for a lawyer to engage in conduct involving dishonesty, fraud, 
deceit or misrepresentation."   
No. 
2012AP385-D   
 
5 
 
 
24(e).  In failing to notify L.T. in writing of 
the receipt of funds in which L.T. had an interest, in 
failing to promptly deliver to L.T. any funds to which 
L.T. was entitled to receive, and in failing to 
provide a full accounting regarding the distribution 
of 
L.T.'s 
funds 
to 
L.T., 
Biester 
violated 
SCR 
20:1.5(d)(1) and SCR 20:1.15(d)(2).5 
¶4 
Referee 
Flynn 
also 
presided 
over 
the 
earlier 
disciplinary proceeding.  When the referee issued his first 
report in 2013, there was a possibility that criminal charges 
might be filed against Attorney Biester.  In order to protect 
Attorney 
Biester's 
Fifth 
Amendment 
right 
against 
self-
incrimination, the referee stayed proceedings as to Count Two. 
In March of 2015, the OLR notified this court that the Wisconsin 
Department of Justice had determined it will not criminally 
prosecute Attorney Biester for her conduct involving L.T.  
                                                 
5 Effective July 1, 2016, substantial changes were made to 
Supreme Court Rule 20:1.15, the "trust account rule."  See S. 
Ct. Order 14-07, (issued Apr. 4, 2016, eff. July 1, 2016).  
Because the conduct underlying this case arose prior to July 1, 
2016, unless otherwise indicated, all references to the supreme 
court rules will be to those in effect prior to July 1, 2016. 
SCR 20:1.15(d)(1) and SCR 20:1.15(d)(2) provide:  "(1) 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 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.   
(2) Upon 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." 
No. 
2012AP385-D   
 
6 
 
Criminal charges are apparently pending against J.M. On May 12, 
2015, this court granted the OLR's motion to lift the stay of 
proceedings with respect to Count Two and further ordered that 
the matter be referred to a referee for additional proceedings 
regarding Count Two of the amended complaint.  Referee Flynn was 
again appointed to preside over the proceedings regarding Count 
Two of the amended complaint.  
¶5 
An evidentiary hearing in this matter was held on 
November 16, 2015.  The only witnesses to testify at the hearing 
were Attorney Biester and Attorney Arthur K. Thexton, the 
character witness called by Attorney Biester.  Attorney Thexton 
stated that Attorney Biester has a reputation for being truthful 
and honest.  He also said he knows of J.M. from a time in the 
1980s when he was a Wisconsin district attorney and he secured a 
conviction against J.M. for criminal fraud.  The conviction 
resulted in a prison sentence for J.M. 
¶6 
The referee issued his report and recommendation on 
Count Two of the amended complaint on December 1, 2015.  The 
referee noted that in its case in chief, OLR presented the 
videotaped 
deposition 
of 
L.T. 
 
L.T. 
testified 
that 
her 
interaction with Attorney Biester regarding her divorce was 
almost exclusively through J.M.  L.T. said she was advised by 
Attorney Biester, acting through J.M., to transfer $78,000 into 
Attorney Biester's client trust account as a way of protecting 
those funds from her husband in the divorce proceeding.  L.T. 
said she learned from J.M. about a month after transferring the 
$78,000 that the money had been used to purchase a home that 
No. 
2012AP385-D   
 
7 
 
J.M. was going to remodel and then "flip" it and that J.M. was 
going to give L.T. $10,000 to boot within a month.  L.T. said 
when she heard this she was furious and wanted her money back.   
¶7 
L.T. testified that in August 2009 Attorney Biester 
told L.T. that she had learned J.M. had taken the money from 
Attorney Biester's client trust account and had paid off 
Attorney Biester's mortgage on the home that was then in 
foreclosure.  L.T. wrote a letter to the court in the divorce 
matter and explained what had happened.  The court allowed L.T. 
to obtain new counsel.  L.T.'s divorce was ultimately finalized 
but because of the way the $78,000 had been handled, that amount 
was determined to be comingled and viewed as marital property.  
L.T. subsequently made a claim to the Wisconsin Lawyers' Fund 
for Client Protection, which awarded her a full refund of the 
$78,000 due to her being the victim of fraud.  
¶8 
In his report, the referee noted that Attorney Biester 
claimed she did not know that J.M. had a criminal fraud record 
and did not know the $78,000 that was deposited into her client 
trust account came from L.T.  She said J.M. alone made 
arrangements for L.T. to put the funds into the trust account 
and it was not until later that Attorney Biester learned from 
J.M. that the source of the $78,000 was L.T. and some associates 
of J.M.  
¶9 
The referee found L.T.'s testimony to be credible, and 
he found that Attorney Biester was not credible when she claimed 
she did not know that L.T. was the source of the $78,000.  The 
referee noted that the $78,000 was the exact same amount of 
No. 
2012AP385-D   
 
8 
 
money that Attorney Biester believed L.T. had received as an 
inheritance and was at issue in the division of the marital 
estate in the divorce action.  The referee further noted that 
Attorney Biester was actually at her client trust account bank 
when the $78,000 was wired and received.  The referee opined 
this suggests that Attorney Biester knew the funds were coming 
and she was immediately prepared to use those funds for her own 
benefit.   
¶10 The referee said a reasonable inference from the 
evidence was that Attorney Biester and J.M. were acting together 
with full knowledge of what was occurring, and he said Attorney 
Biester had full knowledge that her client's funds were being 
wrongfully placed into her client trust account and were 
thereafter wrongfully converted to Attorney Biester's personal 
use.  The referee said: 
She knew fully what was occurring on 10 February 2009 
in terms of obtaining and converting her client's 
$78,000.  She tried to cover up her wrongful conduct 
by placing the entire blame on her legal assistant, 
J.M.  However, Respondent's failure to notify her 
client was intentional under the credible evidence and 
no reasonable excuse for Respondent not informing L.T. 
was provided.   
¶11 For these reasons, the referee found that the OLR 
presented 
clear, 
satisfactory 
and 
convincing 
evidence 
of 
misconduct by Attorney Biester as alleged in each of the 
averments in Count Two of the amended complaint.   
¶12 Turning to the appropriate sanction, the referee said 
the misconduct at issue here is quite serious.  The referee said 
No. 
2012AP385-D   
 
9 
 
the misconduct was aggravated because Attorney Biester continued 
to claim that she was innocent of wrongdoing and that she had 
been a victim of fraud by her employee.  The referee said 
Attorney Biester took advantage of her relationship with L.T. 
and worked with her employee to have the $78,000 deposited into 
Attorney Biester's client trust account.  The referee said, "The 
actions of this attorney have brought distain [sic] and dishonor 
to the entire legal profession in our State.  A client was 
seriously harmed when she should have been protected." 
¶13 The referee pointed to several mitigating factors.  He 
noted that prior to her 2013 suspension, Attorney Biester had no 
discipline imposed during her 36-year legal career.  The referee 
further noted that Attorney Biester has various health issues.  
He also pointed out that she has fully served the one year 
suspension that was previously ordered by this court.  He also 
noted that Attorney Biester states she is now living on a very 
meager monthly Social Security award.  The referee also noted 
Attorney Biester says she does not know where she would get the 
funds to meet her continuing legal education and ethics course 
requirements in the event she were to seek reinstatement of her 
law license in the future.  
¶14 The referee concluded that Attorney Biester's license 
to practice law should be suspended for the maximum period 
No. 
2012AP385-D   
 
10 
 
allowed.6  The referee also recommends that Attorney Biester be 
ordered to pay the full costs of this proceeding and that she be 
ordered to reimburse the Wisconsin Lawyers Fund for Client 
Protection for the $78,000 that it paid to L.T.  
¶15 A referee's findings of fact are affirmed unless 
clearly erroneous.  Conclusions of law are reviewed de novo.  
See In re Disciplinary Proceedings Against Eisenberg, 2004 WI 
14, ¶5, 269 Wis. 2d 43, 675 N.W.2d 747.  The court may impose 
whatever sanction it sees fit, regardless 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. 
¶16 There is no showing that any of the referee's findings 
of fact are clearly erroneous.  According, we adopt them.  We 
also agree with the referee's conclusions of law that Attorney 
Biester violated the supreme court rules set forth above.  
¶17 With respect to the appropriate level of discipline, 
upon careful review of the matter, we conclude that rather than 
suspending Attorney Biester's license for the maximum period 
allowed, retroactive to November 25, 2013, Attorney Biester's 
license should be suspended for three years and six months 
retroactive to November 25, 2014. 
                                                 
6 We are unsure what the referee meant by the term "the 
maximum period allowed."  The most severe sanction this court 
can impose is the revocation of an attorney's license.  An 
attorney whose license has been revoked may petition for 
reinstatement five years after the effective date of revocation.  
See SCR 22.29(2).  A suspension for "the maximum period allowed" 
would presumably be approximately four years and eleven months.   
No. 
2012AP385-D   
 
11 
 
¶18 As part of its order imposing the one year suspension 
of 
Attorney 
Biester's 
Wisconsin 
law 
license, 
this 
court 
specifically ordered that in the event the stay of proceedings 
relating to Count Two of the amended complaint was lifted and 
there was an additional finding of misconduct as to Count Two, 
"any sanction imposed as a result of that misconduct shall run 
consecutive to the one year suspension imposed by the terms of 
this order."  Disciplinary Proceedings Against Biester, 350 
Wis. 2d 707, ¶33.  In order for the sanction imposed in the 
instant case to run consecutive to the prior one year 
suspension, the new sanction must be effective November 25, 
2014.   
¶19 We agree that the misconduct at issue here was very 
serious, but we are not convinced that it rises to the level of 
warranting a suspension of Attorney Biester's law license that 
approaches five years.  Although no two disciplinary proceedings 
are identical, we find the decision in In re Disciplinary 
Proceedings Against Carter, 2014 WI 126, 359 Wis. 2d 70, 856 
N.W.2d 595 to be somewhat similar.  In Carter, an attorney who 
had been in practice for nearly 40 years pled no contest to 11 
counts of misconduct, including converting over $72,000 of a 
client's funds.  Carter's law license was suspended for three 
years.  Mitigating factors in Carter were the attorney's lack of 
previous misconduct and his expression of remorse.  Aggravating 
factors included the fact that the attorney's conduct was 
reckless and highly unprofessional and the attorney initially 
accused the client of trying to take advantage of him.     
No. 
2012AP385-D   
 
12 
 
¶20 In this case, Attorney Biester practiced law for over 
30 years before being disciplined.  Attorney Biester converted a 
similar amount of money as Attorney Carter.  However, unlike 
Attorney Carter, Attorney Biester has still not accepted full 
responsibility for her actions and instead continues to blame 
her former employee and portray herself as a victim.  For all of 
these reasons, we conclude that a three year and six month 
suspension 
of 
Attorney 
Biester's 
license, 
retroactive 
to 
November 25, 2014, is an appropriate sanction.   
¶21 We agree with the referee that Attorney Biester should 
be required to reimburse the Wisconsin Lawyers' Fund for Client 
Protection and that she should also be required to pay the full 
costs of this proceeding.  
¶22 IT IS ORDERED that the license of Mary K. Biester to 
practice law in Wisconsin is suspended for a period of three 
years and six months, retroactive to November 25, 2014. 
¶23 IT IS FURTHER ORDERED that within 60 days of the date 
of this order, Mary K. Biester shall make restitution in the 
amount of $78,000 to the Wisconsin Lawyers' Fund for Client 
Protection.  
¶24 IT IS FURTHER ORDERED that within 60 days of the date 
of this order, Mary K. Biester shall pay to the Office of Lawyer 
Regulation the costs of this proceeding, which are $8,712.86 or 
enter into a payment agreement plan with the Office of Lawyer 
Regulation for the full payment of costs over a period of time. 
No. 
2012AP385-D   
 
13 
 
¶25 IT IS FURTHER ORDERED that the restitution specified 
above is to be completed prior to paying costs to the Office of 
Lawyer Regulation.  
¶26 IT IS FURTHER ORDERED that compliance with all 
conditions of this order is required for reinstatement.  See SCR 
22.29(4)(c). 
 
 
No.  2012AP385-D.ssa 
 
1 
 
 
¶27 SHIRLEY S. ABRAHAMSON, J.   (concurring).  I join the 
court's decision and order as to the discipline imposed in this 
matter.  I write separately to address costs and restitution. 
¶28 Attorney Biester has been ordered to pay the Office of 
Lawyer Regulation $8,712.86 in costs and to make restitution in 
the amount of $78,000 to the Wisconsin Lawyers' Fund for Client 
Protection.  In the event Attorney Biester petitions for the 
reinstatement of her license to practice law in Wisconsin, she 
will be required to demonstrate that she has complied fully with 
the terms of the order of suspension, see SCR 22.29(4)(c), and 
that she has made restitution to or settled all claims of 
persons injured or harmed by her misconduct or explained the 
failure or inability to do so.  See SCR 22.29(4m). 
¶29 If an attorney has satisfied all of the requirements 
set forth in SCRs 22.31(1) and 22.29(4)(a)-(4m), his or her 
license to practice law may be reinstated notwithstanding the 
failure to pay costs or make restitution provided the attorney 
has been unable to do so due to a lack of financial resources.  
I write separately to clarify that Attorney Biester's inability 
to pay costs or make restitution, standing alone, would not 
automatically bar her from regaining her law license.  See, 
e.g., In re Disciplinary Proceedings Against Widule, 2012 WI 63, 
341 Wis. 2d 493, 817 N.W.2d 822; In re Disciplinary Proceedings 
Against Gilbert, 2002 WI 102, 255 Wis. 2d 311, 647 N.W.2d 845. 
 
 
No.  2012AP385-D.ssa 
 
 
 
1