Opinion ID: 4266696
Heading Depth: 1
Heading Rank: 3

Heading: jurisdiction

Text: The Board retains jurisdiction over the allegations alleged in this complaint despite Mr. Kane statement that he has resigned from his judicial office. See R.S.C.D.C.J. 3(1) (“The Board has continuing jurisdiction over former judges regarding allegations that misconduct occurred during their judicial service if a complaint is made within three years of the discovery of the grounds for the complaint.”). Moreover, as the parties agree and the Board finds, Canon 5 makes clear that the Code of Judicial Conduct becomes applicable once a person declares his or her candidacy for the assistant judge position. See Canon 5C, 5B, Terminology [2]. Therefore, the Board retains jurisdiction over Mr. Kane’s activities between July or August 2014 and the evidentiary hearing held on March 20-22, 2017. Findings on Alleged Canon Violations The alleged violations of Canons 1, 2A, 4A(2), and 5B(2) are based on the same factual allegations regarding the Olbrych and Carrier loans, including his testimony at the November 5, this matter and the issuance of this disposition report, the civil division dismissed Mr. Kane’s appeal. See Kane v. Estate of Tolaro, No. 523-11-16 Wrcv (Vt. Super. Ct. Mar. 27, 2017) (Gerety, J.). 13 2015 probate hearing, his original and amended statement of claim, the handling of the Jackson and Great American annuities, and the handling of the Pleasant Street property. In order to find a violation of the Code of Judicial Conduct as to these allegations, the Board must concluded that Mr. Kane’s conduct was intentional, not merely a mistake. In re Kroger, 167 Vt. 1, 7 (1997). “Intent can, of course, be inferred from the evidence. For example, if the evidence shows that a judge had personal knowledge of facts contrary to the judge’s statement, the judge’s intent to deceive may be inferred.” Id. at 7 n.2. In finding a violation of the Code, it is unnecessary to determine if the judge acted with bad faith or evil intent. Id. at 6. Similarly, it is irrelevant “whether [the judge] realized any tangible personal benefit or pecuniary gain from the transaction.” In re Boardman, 2009 VT 42, ¶ 15, 186 Vt. 176. Olbrych and Carrier Loans The evidence established that between July and October 2014, when Mr. Kane was subject to the Code, he deposited Mr. Olbrych’s loan payments into accounts that were his sole property, regardless of whether the money was deposited into the -4018 account or -6088 account. Moreover, Mr. Kane had Mr. Olbrych make the checks payable to “Paul Kane,” including during the time period when Mr. Kane was subject to the Code, even though Mr. Kane knew that the money loaned to Mr. Olbrych was Ms. Tolaro’s money. Also, rather than being forthcoming with Attorney French, Mr. Kane made Attorney French go through his bank records and prove at an evidentiary hearing that he had wrongly received certain payments from Mr. Olbrych. The evidence further establishes that Mr. Kane did not inform Attorney Moore, as administrator of Ms. Tolaro’s estate, of the Olbrych and Carrier loans shortly after the estate was opened in July 2014. Between October and December 2014, Mr. Kane intentionally negotiated the terms of Mr. Olbrych’s release from the 2011 loan, such that it required Mr. Olbrych to transfer the property to Mr. Kane. Mr. Kane made this agreement even though he knew that the debt on the 2011 loan was owed to Ms. Tolaro’s estate, not him, and that he would be benefiting from the improvements made to the property in connection with the 2011 loan. There was no evidence that Mr. Kane ever attempted to reimburse Ms. Tolaro’s estate for the benefit he received when Mr. Olbrych gave him the property. As to the Carrier loan, Mr. Kane intentionally conducted the sale of the mobile home, alleging on multiple official documents that he was the owner of the mobile home when he knew that it was Ms. Tolaro’s funds, not his, that had financed the loan. Moreover, he conducted this sale one day after Attorney French had been assigned the new estate administrator. He intentionally did not inform her of the sale, or the fact that he had put $10,000 in cash, Ms. Tolaro’s proceeds from the settlement, into his personal safety deposit box, and he intentionally did not reveal or turn those funds over when initially requested by Attorney French. Mr. Kane intentionally misled both Attorney Moore and Attorney French as to the truth about the origin of the funds of both the Carrier and Olbrych loans for months. He knew those loans were from Ms. Tolaro’s accounts and testified he considered those loans assets of Ms. Tolaro [hence her estate] yet he intentionally misled Attorneys Moore and French on the ownership of those funds and he intentionally forgave those loans without authority to do so. It was not until Mr. Kane was forced to testify at the November 5, 2015 hearing that Attorney French even became aware of the existence of the $10,000. Moreover, as the evidence of his misuse of Ms. Tolaro’s money mounted, Mr. Kane continued to offer intentionally misleading testimony. Even though Mr. Kane knew that the money, particularly the $10,000, was the property of Ms. Tolaro’s estate, he intentionally refused to surrender it to the estate administrator, who had specifically requested 14 that he turn over all estate assets on May 29, 2015, until ordered after he was ordered by the court to do so on May 24, 2016. Based on this evidence alone, it is established by clear and convincing evidence that Mr. Kane violated Canon 1 (“A judge should participate in establishing, maintaining and enforcing high standards of conduct, and shall personally observe those standards so that the integrity and independence of the judiciary will be preserved.”); Canon 2A (“A judge shall respect and comply with the law and shall act at all times in a manner that promotes public confidence in the integrity and impartiality of the judiciary.”); 4A(2) (“A judge shall conduct all of the judge’s extra-judicial activities so that they do not … demean the judicial office”); and 5B(2) (“[I]f a candidate for initial appointment to state judicial office, shall maintain the dignity appropriate to judicial office and act in a manner consistent with the integrity and independence of the judiciary.”).8 Specifically, Mr. Kane’s treatment of the loan repayments as his own, his lack of forthrightness with the estate administrators, his intentional misleading of attorneys Moore and French, and his hiding and withholding of the $10,000 all demonstrate that Mr. Kane failed to observe high standards of conduct such that his actions diminished the integrity of the Judiciary. Further, his intentionally misleading testimony at the November 5, 2015 hearing demonstrated a failure to act in such a way to promote public confidence in the integrity of the Judiciary. In fact, his continued failure to inform the court that he had given intentionally misleading testimony demonstrates a continuing failure to observe the high standards of personal conduct and a continuing failure to act in a way that promotes public confidence in the integrity of the Judiciary. Taken as a whole, Mr. Kane’s treatment of these loans during the time in which he was a candidate for, and holder of, the office of assistant judge demeaned the judicial office. Statement of Claim It was established by clear and convincing evidence that Mr. Kane intentionally filed a facially implausible claim. The circumstances demonstrate Mr. Kane’s conduct was intentional for several reasons. First, he claimed that he was providing services to Ms. Tolaro 159 hours out of 169 hours in a week, for 135 weeks, despite the fact that he had a full-time job and had previously indicated in emails that only Mrs. Kane was providing care for Ms. Tolaro. Second, even if the 159 hours was an accurate weekly estimate, the claim still attempted to double-charge the estate for his alleged services rendered by also claiming he was owed for management services provided five hours per week for 104 weeks. Third, the claim included a request to be reimbursed $31,827.51, which he had already received from the Jackson annuity. Fourth, the claim included the 159 hours of care for both himself and his wife, even though his wife was deceased and her estate was closed. Mr. Kane reviewed these figures and still signed the statement of claim. Even if the Board where to find that these errors were mistakes, which the Board does not so find, it is undisputed that most of these errors have not been brought to the attention of the Probate and Civil Court, even though he filed an amended claim, and despite the fact that it has been months since Mr. Kane became aware of these errors. Based on this evidence, it is established by clear and convincing evidence that Mr. Kane violated Canons 1, 2A, 4A(2), and 5B(2). Mr. Kane filed both the original and amended claims while he was subject to the Code. Moreover, he has completely failed to correct these blatant errors, with the exception that it took him over a year to file the amended claim indicating it was a mistake for him to file a claim for his wife’s services. By intentionally filing such facially implausible documents and failing to correct blatant errors, Mr. Kane has failed to observe the 8 Canon 5B(2) is applicable to assistant judges pursuant to Canon 5C(1). 15 high standards of conduct such that his actions diminished the integrity of the Judiciary and demeaned the judicial office which he held. Contrary to Mr. Kane’s attorney’s suggestion, a statement of claim is not a mere “ad damnum” clause.9 To the extent that Mr. Kane had a valid claim for compensation for services rendered and expenses advanced, his conduct connected to this claim failed to promote public confidence in the integrity of the judiciary. Annuities and Pleasant Street Property It was established by clear and convincing evidence that Mr. Kane failed to protect Ms. Tolaro’s assets in the Jackson and Great American annuities during the time he was subject to the Code. It is not the Board’s responsibility to determine the propriety of Mr. Kane using his POA to take out the annuities and list himself as the beneficiary; that conduct occurred before he became subject to the Code. However, to the extent that Mr. Kane believed the proceeds of the annuities belonged to Ms. Tolaro’s estate, as he testified to the Board, he was obligated to provide the proceeds to the estate. Instead, he kept the Jackson annuity proceeds in his personal checking account between July and October 2014, when he was subject to the Code. Moreover, Mr. Kane intentionally mislead attorneys Moore and French for months by not disclosing the existence of the Jackson annuity and that he was using those proceeds from the annuity to pay for expenses, repairs, and potentially upgrades connected to the Pleasant Street property, which he knew he stood to inherit under Ms. Tolaro’s will. And even though he continued to knowingly use Ms. Tolaro’s funds to pay these expenses, he intentionally failed to keep or disclose accurate records of his expenditures, such that it has been hard or impossible for Attorney French to determine which expenditures should be reimbursed. Mr. Kane stressed that he was authorized by both administrators to continue using the Jackson funds to pay for the expenses. However, he never disclosed he had those founds. The point is not whether he was authorized to do so or not, rather, the intentionally deceptive nature of his actions impugned the integrity of the Judiciary and demeaned the judicial office. Attorney French requested Mr. Kane turn over all assets of the estate, which would include the proceeds of the annuity, as early as March 24, 2015, and again on May 29, 2015. However, Mr. Kane refused to turn over the proceeds to Attorney French for many months. This refusal to promptly turn over the asset, even though Mr. Kane himself considered it estate property, demonstrates that Mr. Kane failed to meet the high standard of integrity expected of judges and did not ensure public confidence in the Judiciary. Accordingly, it is established by clear and convincing evidence that Mr. Kane violated Canons 1, 2A, 4A(2), and 5B(2).10 Sanctions 9 An “ad damnum” clause is a demand clause. 10 During the course of Special Counsel’s investigation, Mr. Kane’s November 14 and 19, 2014 emails to Mr. Carrier were discovered. These emails were presented at the evidentiary hearing. Mr. Kane acknowledged his comment – that it would be “cool” if Mr. Carrier was incarcerated for failing to pay back the loan – was inappropriate. Although it was not included in the formal complaint, and therefore the Board does not consider it for purposes of sanctions, the Board believes it is necessary to state that such a comment, by a person who had been elected to judicial office days prior, is completely unacceptable. Mr. Kane, in sending this email, failed to maintain the high standard of conduct expected of individuals subject to the Code. 16 Special Counsel seeks sanctions to the fullest extent of the Board’s authority. He asserts that this can include an immediate suspension, a public reprimand, and the barring of Mr. Kane from serving as a judge for life. Mr. Kane contends that his resignation and a public reprimand briefly stating the violations of the Canons is sufficient. In the Board’s unanimous11 judgment, the appropriate sanction for Paul Kane’s violation of Canons 1, 2A, 4A(2), and 5B(2) is the immediate and indefinite suspension from judicial office, a public reprimand, and a prohibition on his ever holding judicial office in Vermont. Although Mr. Kane and Attorney Fink represented that he has submitted his resignation to several officials, they did not provide the Board with proof that Mr. Kane had actually resigned. Therefore, an immediate suspension is appropriate. Moreover, because a formal complaint was filed, a public reprimand is required. See In re Balivet, 2014 VT 41, ¶¶ 31-41, 196 Vt. 425. Finally, the Board considers the permanent prohibition on holding judicial office appropriate due to the severity of Mr. Kane’s conduct, the fact that these violations continued throughout his tenure as assistant judge, his refusal to take responsibility for his actions in his testimony before the Board, and his multiple instances of providing demonstrably false testimony to the Board at the hearing. The Board concludes that these three sanctions are necessary to accomplish the purpose of judicial discipline, that is to “protect the public, ensure the evenhanded administration of justice, and preserve and enhance public confidence in the integrity and fairness of the justice system.” Id. ¶ 39 (quoting In re O’Dea, 159 Vt. 590 (1993)). PUBLIC REPRIMAND Paul Kane is hereby publicly reprimanded for violating Canons 1, 2A, 4A(2), and 5B(2) of the Vermont Code of Judicial Conduct. From the date this Order becomes final, and as further detailed in the Disposition Report of the Judicial Conduct Board dated April 24, 2017, Mr. Kane shall be immediately and indefinitely suspended from the office of assistant judge and shall be prohibited from holding any judicial office in the State of Vermont in the future. BY THE COURT: