Case Name: In the Matter of the Application for DISCIPLINARY ACTION AGAINST Theresa L. KELLINGTON, a Member of the Bar of the State of North Dakota. Disciplinary Board of the Supreme Court of the State of North Dakota, Petitioner v. Theresa L. Kellington, Respondent
Court: North Dakota Supreme Court
Jurisdiction: North Dakota
Decision Date: 2014-08-28
Citations: 852 N.W.2d 395
Docket Number: Nos. 20140080, 20140081
Parties: In the Matter of the Application for DISCIPLINARY ACTION AGAINST Theresa L. KELLINGTON, a Member of the Bar of the State of North Dakota. Disciplinary Board of the Supreme Court of the State of North Dakota, Petitioner v. Theresa L. Kellington, Respondent.
Judges: [¶ 35] GERALD W. VANDE WALLE, C.J., DALE V. SANDSTROM, LISA FAIR McEVERS, and CAROL RONNING KAPSNER, JJ„ concur.
Reporter: North Western Reporter 2d
Volume: 852
Pages: 395–408

Head Matter:
2014 ND 168
In the Matter of the Application for DISCIPLINARY ACTION AGAINST Theresa L. KELLINGTON, a Member of the Bar of the State of North Dakota. Disciplinary Board of the Supreme Court of the State of North Dakota, Petitioner v. Theresa L. Kellington, Respondent.
Nos. 20140080, 20140081.
Supreme Court of North Dakota.
Aug. 28, 2014.
Brent J. Edison, Bismarck, N.D., for petitioner.
Ronald H. McLean (argued) and Ian McLean (on brief), Fargo, N.D., for respondent.

Opinion:
PER CURIAM.
[¶ 1] Theresa Kellington objects to the report of a hearing panel of the Disciplinary Board recommending she be suspended from the practice of law for 60 days and pay the costs of the proceedings. We conclude there is clear and convincing evidence Kellington violated N.D.R. Prof. Conduct 1.5(a), fees, and 5.3(a), supervision of non-lawyer assistants. We order that Kellington be suspended from the practice of law for 30 days and pay $4,965.95 in costs of the disciplinary proceedings.
I
[¶ 2] In Disciplinary Board v. Kellington, 2011 ND 241, ¶ 6, 809 N.W.2d 298, we suspended Kellington from the practice of law for ninety days but stayed the suspension and placed her on probation for one year, subject to her having no further meritorious disciplinary complaints during the period of probation.
[¶ 3] In May 2013, the Disciplinary Board filed an amended petition to revoke Kellington's probation and to subject her to additional discipline as a result of a new complaint filed against her. After an evi-dentiary hearing, the hearing panel made the following findings: In August 2011, Angela Dieterle retained Kellington to represent her in connection with a divorce. Kellington agreed to represent Dieterle on an hourly fee basis at a rate of $150.00 per hour. Between August 31, 2011, and January 31, 2012, Kellington billed Dieterle approximately $20,000.00. Kellington's billing records reflect duplicative and unnecessary charges for cover letters, charges for overhead items, charges at the wrong hourly rate, and duplicative charges for routine correspondence. Her billing records reflect time entries for herself as well as entries for legal assistants Nicole Wek and Sue Rossow. Wek has a two-year accounting degree, and Rossow has a bachelor's degree in accounting. When hired by Kellington, neither Wek nor Ros-sow had ever worked as a legal secretary or legal assistant, but Wek had experience working as an assistant to the non-attorney bill collectors at a collection law firm. When Wek and Rossow went to work for Kellington, they did not receive any orientation or training beyond a time-keeping system training. When they worked on Dieterle's file, neither met the guidelines set forth in comment 4 of N.D.R. Prof. Conduct 5.3 for evaluating the education, training, or experience of a qualified legal assistant.
[¶ 4] The hearing panel concluded Kell-ington violated provisions of the North Dakota Rules of Professional Conduct involving client fees under Rule 1.5(a) and responsibilities for nonlawyer assistants under Rule 5.3(a), (b), & (c). The panel recommended Kellington be suspended from the practice of law for 60 days and pay costs and expenses of the proceedings in the amount of $4,965.95. The panel's 60-day recommendation combines a new suspension with a suspension for Kelling-ton's violation of her probation imposed for prior misconduct in Kellington, 2011 ND 241, 809 N.W.2d 298.
[¶ 5] The hearing panel had jurisdiction under N.D.R. Lawyer Discipl. 3.1(E). Kellington did not file timely objections to the hearing panel's report within 20 days under N.D.R. Lawyer Discipl. 3.1(F), and the Board did not file its findings and recommendation within the 60-day requirement of Rule 3.1(F). Kellington has raised this as an issue, but these deficiencies are insufficient to warrant dismissal of the case, because the delay did not affect the fundamental fairness of the disciplinary process. See also Disciplinary Board v. Overboe, 2014 ND 62, 844 N.W.2d 851 (a long delay must destroy the fundamental fairness of the entire disciplinary process to warrant dismissal of the disciplinary case). This Court has jurisdiction under N.D. Const, art. VI, § 3, N.D.C.C. § 27-14-01, and N.D.R. Lawyer Discipl. 3.1(F).
II
[¶ 6] We review disciplinary proceedings de novo on the record. Disciplinary Board v. McDonald, 2000 ND 87, ¶ 13, 609 N.W.2d 418. Each alleged violation must be proved by clear and convincing evidence. Disciplinary Board v. Lee, 2013 ND 151, ¶ 9, 835 N.W.2d 836. "We give due weight to the findings, conclusions, and recommendations of the [hearing panel], but we do not act as a 'rubber stamp' for those findings and recommendations." McDonald, at ¶ 13. We give deference to the hearing panel's findings on matters of conflicting evidence and credibility of witnesses when the panel has heard the witnesses and observed their demeanor. Id.
[¶ 7] Although this Court has not previously stated the burden of proof necessary to revoke a lawyer's probation, other courts have explained that in disciplinary proceedings involving professional licenses, probation is revoked when allegations are proved by a preponderance of the evidence:
Sandarg correctly points out that the standard of proof to revoke a professional license is clear and convincing evi- denee. (Ettinger v. Board of Medical Quality Assurance (1982) 135 Cal. App.3d 853, 856, 185 Cal.Rptr. 601.) The administrative law judge and the trial court applied that standard with respect to the board's accusation. But that same standard did not apply to the board's petition to revoke Sandarg's probation.
The courts have addressed a similar issue in criminal cases. The standard of proof in a criminal case is, of course, beyond a reasonable doubt. (PemCode, § 1096.) However, once a convicted criminal is placed on probation, the government is not required to prove beyond a reasonable doubt that he or she violated the terms of probation in order [to] revoke probation. Rather, the "standard of proof required for revocation of probation is a preponderance of evidence to support the violation." (People v. Kelly (2007) 154 Cal.App.4th 961, 965, 66 Cal.Rptr.3d 104.)
The same analysis applies here. While the board is required to prove the allegations in an accusation by clear and convincing evidence, it is only required to prove the allegations in a petition to revoke probation by a preponderance of the evidence.
Sandarg v. Dental Bd. of California, 184 Cal.App.4th 1434, 1441, 109 Cal.Rptr.3d 826 (2010).
[¶ 8] We adopt the same standard of proof as established in Dental Bd. of California. 184 Cal.App.4th at 1441, 109 Cal.Rptr.3d 826. In order to revoke a lawyer's probation which has been implemented in a prior disciplinary proceeding, the board must prove a violation by a preponderance of the evidence.
Ill
A
[¶ 9] Kellington argues the hearing panel erred in determining she violated N.D.R. Prof. Conduct 1.5(a), which precludes lawyers from charging an unreasonable fee and provides:
A lawyer shall not make an agreement for, charge, or collect an unreasonable fee or an unreasonable amount for expenses. The factors to be considered in determining the reasonableness of a fee include the following:
(1) the time and labor required, the novelty and difficulty of the questions involved, and the skill requisite to perform the legal service properly;
(2) the likelihood, if apparent to the client, that the acceptance of the particular employment will preclude other employment by the lawyer;
(3) the fee customarily charged in the locality for similar legal services;
(4) the amount involved and the results obtained;
(5) the time limitations imposed by the client or by the circumstances;
(6) the nature and length of the professional relationship with the client;
(7) the experience, reputation, and ability of the lawyer or lawyers performing the services; and
(8) whether the fee is fixed or contingent.
[¶10] Kellington claims the panel erred in determining factors one and four of N.D.R. Prof. Conduct 1.5(a) weigh against the reasonableness of the fee, and also erred in ignoring or determining the remaining factors are irrelevant.
[¶ 11] Comment 1 of N.D.R. Prof. Conduct 1.5 provides:
Paragraph (a) requires that lawyers charge fees that are reasonable under the circumstances. The factors specified in (1) through (8) are not exclusive. Nor will each factor be relevant in each instance. Paragraph (a) also requires that expenses for which the client will be charged be reasonable....
[¶ 12] In support of its conclusion that Kellington charged an unreasonable fee in violation of Rule 1.5(a), N.D.R. Prof. Conduct, the hearing panel found that Diet-erle's divorce case was not particularly novel or complex and that Kellington billed approximately $20,000.00 over a five-month period despite knowing Dieterle had come to her as a potential reduced-fee client. The panel also found that Kelling-ton's billing records reflect unreasonable charges including duplicative and unnecessary charges for cover letters, charges for overhead items, charges at the wrong hourly rate, and duplicative charges for routine correspondence.
[¶ 18] Although the panel found Diet-erle was a difficult client, under Rule 1.5(a), difficult clients do not equate with difficult legal issues, and the record reflects this divorce case involved issues present in a typical divorce. A difficult client, however, may increase the cost of litigation, as it did in this case, and this is a consideration for what is a reasonable fee under Rule 1.5(a) for reasons set out in the panel's findings.
[¶ 14] However, the billing records provided by Kellington reflect that she double-billed, she billed for overhead items, and she billed at the wrong hourly rate. This facts of this case are similar to Disciplinary Board v. Delorme, 2011 ND 40, 795 N.W.2d 293, in which we concluded the attorney violated N.D.R. Prof. Conduct 1.5. In Delorme, the attorney, among other things, charged at an hourly rate greater than what was agreed to, failed to reflect a payment by the client, overbilled for mileage, billed over 24 hours on a given day, and billed for time in which the attorney provided no legal services. Id. at ¶ 4. On the basis of clear and convincing evidence, as well as our conclusion in De-lorme, we adopt the panel's recommendation that Kellington's fee was unreasonable under N.D.R. Prof. Conduct 1.5(a).
B
[¶ 15] Kellington argues her fee is reasonable even though it contains minor billing errors because, she claims, a bill containing de minimus billing errors has never resulted in discipline in North Dakota. She also argues she performed a substantial amount of legal work which was not billed and which was substantially greater than the total amount of billing errors. Despite these contentions, Kellington's improper billing previously discussed is sufficient to establish that her fee is unreasonable under N.D.R. Prof. Conduct 1.5(a).
IV
[¶ 16] Kellington argues the hearing panel erred in concluding she violated N.D.R. Prof. Conduct 5.3(a), (b), and (c), regarding supervision of non-lawyer assistants.
[¶ 17] Rule 5.3 provides, in relevant part:
With respect to a nonlawyer employed or retained by or associated with a lawyer:
(a) a partner, and a lawyer who individually or together with other lawyers has comparable managerial authority in a law firm, shall make reasonable efforts to ensure that the firm has in effect measures giving reasonable assurance that the nonlawyer's conduct is compatible with the professional obligations of the lawyer;
(b) the lawyer having direct supervisory authority over the nonlawyer shall make reasonable efforts to ensure that the nonlawyer's conduct is compatible with the professional obligations of the lawyer; and
(c) a lawyer shall be responsible for conduct of a nonlawyer that would be a violation of these Rules if:
(1) the lawyer orders or, with knowledge of the specific conduct, ratifies the conduct involved; or
(2) the lawyer is a partner or has comparable managerial authority in the law firm in which the nonlawyer is employed, or has direct supervisory authority over the nonlawyer, and knows of the conduct at a time when its consequences can be avoided or mitigated, but fails to take reasonable action.
[¶ 18] Nicole Wek and Sue Rossow were legal assistants for Kellington when she was working on Dieterle's case. In finding Kellington failed to properly supervise her assistants, the hearing panel cited the following: Wek's testimony that it was typical for her to bill time for faxing affidavits to clients, e-filing documents, and preparing routine documents such as proofs of service; Wek's testimony that, beyond instructions to not bill for things like filing or organizing the file, Kellington did not provide any instructions as to what tasks should be considered non-billable overhead; Rossow's testimony in which she stated that it was typical for both her and Kellington to bill time for the same transmittal letters to clients, that it was typical for her to bill for transcribing Kellington's dictation, and that it was typical for her to print out Dieterle's emails and mail them to Dieterle with a cover letter that she billed for.
[¶ 19] The evidence demonstrates that Kellington's assistants were instructed not to bill for fifing or file organization, but otherwise were not provided any instructions as to what tasks should be considered non-billable. For work other than fifing, they recorded their time in the office billing system. The panel found:
As the sole owner of [the firm], and the one with direct supervisory authority over legal assistants, Kellington failed to make reasonable efforts to ensure that her law firm had in effect measures giving reasonable assurance that non-lawyer assistants' conduct was compatible with Kelfington's professional obligations.
[¶ 20] The panel concluded Kelfington's conduct violated Rule 5.3(a), (b) and (c), N.D.R. Prof. Conduct, finding Kellington failed to properly supervise her assistants, whose billing practices did not comply with the standards of professional conduct.
[¶ 21] We can find no authority supporting a conclusion that either Kellington or the legal assistants did anything ethically improper by recording the legal assistants' time in the office billing system. Rossow testified that after the times were entered, Kellington would go through and review the time entries before the statements were mailed out. The testimony thus demonstrates that Kellington controlled what recorded time would be billed to the client. If the legal assistants recorded their time and Kellington chose to improperly bill for those efforts, that is the Rule 1.5(a) violation discussed above. Therefore, the Rule 5.3 question is not whether Kellington overbilled the legal assistants' time but whether she violated Rule 5.3 for other reasons.
[¶ 22] Subsection (a) of Rule 5.3 required Kellington to make "reasonable efforts to ensure that the firm has in effect measures giving reasonable assurance that the nonlawyer's conduct is compatible with the professional obligations of the lawyer." N.D.R. Prof. Conduct 5.3(a). The rule comment explains:
A lawyer must give such nonlawyers appropriate instruction and supervision concerning the ethical aspects of their employment, particularly regarding the obligation not to disclose information relating to representation of the client, and is responsible for their work product. The measures employed in supervising nonlawyers should take account of the fact that they do not have legal training and are not subject to professional discipline.
N.D.R. Prof. Conduct 5.3 cmt. 1.
[¶28] Rule 5.3(a) focuses on the lawyer's duty to train and supervise nonlaw-yers. In this case, Kellington did little to train her legal assistants. The evidence shows Kellington's assistants received no orientation or training other than for the timekeeping system and they never attended any classes or seminars except for how to be a notary. We conclude this evidence establishes Kellington violated Rule 5.3(a).
[¶ 24] Subsection (b) of Rule 5.3 requires "the lawyer having direct supervisory authority over the nonlawyer [to] make reasonable efforts to ensure that the nonlawyer's conduct is compatible with the professional obligations of the lawyer." Although the panel concluded Kellington violated this subsection of the rule, we can find no evidence establishing that the conduct of Kellington's assistants was incompatible with the professional obligations of a lawyer. Much of the panel's conclusion hinged on the legal assistants' alleged improper billing, and we previously concluded that the billing practices of her legal assistants was not improper. Kellington's legal assistants recorded their time for the work they performed, which itself was not an ethical violation. The record supports a conclusion that her assistants performed work appropriate for nonlawyer assistants, and we conclude there is no evidence supporting a finding that Kellington violated Rule 5.3(b).
[¶ 25] Subsection (c) of Rule 5.3 states that "a lawyer shall be responsible for conduct of a nonlawyer that would be a violation of these Rules...." As stated in our discussion of subsection (b) above, we can find nothing in the record establishing that any of the conduct by Kellington's legal assistants was improper. We therefore conclude that Kellington did not violate subsections (b) and (c) of Rule 5.3.
[¶ 26] The panel also found that when Kellington's assistants worked on Diet-erle's file, neither of the assistants met the guidelines set forth in N.D.R. Prof. Conduct 5.3, comment 4, for evaluating the education, training or experience of the legal assistant. Comment 4 of N.D.R. Prof. Conduct 5.3 provides:
The following guidelines have been recognized as helpful in evaluating the education, training or experience of a qualified legal assistant.
1) Graduation from one of the following ABA approved legal assistant/paralegal programs: bachelor's degree, associate's degree, or a post-baccalaureate program. If not ABA approved, graduation from a legal assistant/paralegal program that consists of a minimum of 60 semester credit hours or the equivalent, of which eighteen semester credit hours are substantive legal assistant/paralegal courses.
2) A bachelor's degree in any field, and either one-year employer training as a legal assistant/paralegal or eighteen semester credit hours of legal assistant/paralegal substantive courses.
3) Successful completion of a national certifying examination that is specifically designed for legal assistants/paralegals and which includes continuing legal education for maintenance of that certification status.
4) Seven years or more of experience working as a legal assistant/paralegal who has been employer trained by and under the supervision of a lawyer.
[¶ 27] The panel found that Wek has a two-year accounting degree and Rossow has a bachelor's degree in accounting. The panel found that when hired by Kell-ington, neither Wek nor Rossow had ever worked as a legal secretary or legal assistant, but Wek had experience working as an assistant to the non-attorney bill collectors at a collection law firm. The hearing panel also found:
[T]hey did not receive any orientation or training, beyond the TABS time-keeping system training that Rossow received. They never attended any classes or seminars, except a class for notaries, while working for Kellington. They never received any training as to what items were billable and non-billable to the client. They were not given any policy or procedure manuals, beyond the North Dakota Century Code rules volume.
[¶ 28] With respect to the panel's finding that Kellington's assistants did not meet the guidelines set forth in Rule 5.3, comment 4, Kellington argues the comment is only a suggestion and there is no evidence her assistants were not qualified to be paralegals beyond simply not meeting the helpful guidelines of comment four. Although it is questionable whether a lawyer should be sanctioned for hiring legal assistants who do not meet the guidelines of Rule 5.3, comment 4, we need not address that argument because we have already concluded Kellington violated Rule 5.3(a). Regardless of whether her assistants satisfied the guidelines of Rule 5.3, comment 4, Kellington's failure to properly train her assistants was a violation of Rule 5.3.
V
[¶ 29] Kellington argues the hearing panel erred in failing to consider mitigating factors which she claims weigh heavily in her favor: she provided disciplinary counsel with all of her billing statements and supporting documentation for every single billing item on the statements; she provided testimony by former clients and other attorneys concerning her reputation as an ethical and competent attorney, as well as testimony that she was contrite over how the matter had played out and "had taken a plethora of steps to ensure such a situation would not happen again"; and she did not have a dishonest motive for billing Dieterle for minor overhead items.
[¶ 30] Rule 9.1, N.D. Stds. Imposing Lawyer Sanctions, provides: "After misconduct has been established, aggravating and mitigating circumstances may be considered in deciding what sanction to impose." This rule does not require the hearing panel to consider mitigating factors. It states "mitigating circumstances may be considered.... " See Interest of C.J.A, 473 N.W.2d 439, 441 (N.D.1991) ("As a general rule of statutory construction, the word 'shall' in a statute creates a mandatory duty...."); Novak v. Novak, 74 N.D. 572, 577, 24 N.W.2d 20, 23 (1946) ("The word 'may' as ordinarily used is permissive and not mandatory.... Ordinarily, when used in a statute it is permissive only and operates to confer discretion.").
[¶ 31] With regard to aggravating and mitigating factors, the panel concluded:
[I]n light of the Standards and Kelling-ton's disciplinary history and probationary status, the most appropriate sanction is a 60-day suspension: 30 days for Kellington's misconduct in [this file], . and a lifting of the stay and service of 60-day suspension with 30 days suspended of the 90 day suspension imposed in Disciplinary Board v. Kellington, 2011 ND 241 [809 N.W.2d 298],... The suspension in both cases shall run concurrently.
[¶ 32] This case is not the type of situation presented in Disciplinary Board v. Hoffman, 2013 ND 137, 834 N.W.2d 636, in which we ordered the lawyer to simply refund unearned portions of a fee because we concluded, as a matter of first impression, it was not permissible to have nonrefundable fees in criminal cases. Instead, Kellington's conduct is more like that in Delorme, 2011 ND 40, 795 N.W.2d 293, in which we suspended an attorney for 30 days for charging an unreasonable fee. As in Delorme, Kellington charged an unreasonable fee and has a prior disciplinary offense. See Disciplinary Board v. Kellington, 2011 ND 241, ¶ 6, 809 N.W.2d 298 (Kellington was placed on probation subject to the condition that she have no further disciplinary complaints during the period of probation). Because the facts of this case are similar to those in Delorme, we conclude Kellington should receive a comparable 30-day suspension rather than the 60-day suspension recommended by the hearing panel.
[¶ 33] We additionally note that although the conduct in this case occurred around the time Kellington was placed on probation for her prior misconduct in Disciplinary Board v. Kellington, 2011 ND 241, 809 N.W.2d 298, the decision in that case was filed on December 20, 2011, and the record in this case demonstrates that some of Kellington's improper billing occurred after that December 20 filing date. The evidence thus shows Kellington was on notice of her probation at the time of these billing violations, and the timing of the conduct does not prevent this Court from revoking her probation.
VI
[¶ 34] We adopt the hearing panel's findings, but suspend Kellington from the practice of law in North Dakota for 30 days instead of 60 days as recommended by the panel. The suspension combines a new suspension with a suspension for Kell-ington's violation of her probation imposed for prior misconduct in Kellington, 2011 ND 241, 809 N.W.2d 298. The suspension is effective October 1, 2014. We also order Kellington to pay the costs of the disciplinary proceeding in the amount of $4,965.95 within sixty days, payable to the Secretary of the Disciplinary Board, Judicial Wing, 1st Floor, 600 East Boulevard Avenue, Bismarck, ND 58505-0530. Kellington must comply with N.D.R. Lawyer Discipl. 6.3 regarding notice. Reinstatement is governed by N.D.R. Lawyer Discipl. 4.5.
[¶ 35] GERALD W. VANDE WALLE, C.J., DALE V. SANDSTROM, LISA FAIR McEVERS, and CAROL RONNING KAPSNER, JJ" concur.