Opinion ID: 2567684
Heading Depth: 1
Heading Rank: 2

Heading: Reliance on Statements Outside the Record

Text: First, the Respondent takes exception to the inclusion of a footnote in the final hearing report regarding statements he purportedly made to the presiding officer, Sally Harris, on a prehearing conference call. The Respondent reportedly told Harris he had heard rumors that some of the named witnesses would not be appearing and requested confirmation that the burden of proof was clear and convincing evidence. The Respondent argues the panel's reliance on these statements violated Supreme Court Rule 211(e) (2007 Kan. Ct. R. Annot. 304), requiring all witnesses to be sworn and all proceedings and testimony to be recorded, because such statements were neither sworn nor recorded. Accordingly, the Respondent contends that because the statements affected his credibility as a whole, the panel's reliance on the statements invalidates the entire proceeding. Additionally, the Respondent contends the panel's reliance on these statements violated his due process rights because the Respondent was never made aware of the panel's concern with these statements or given an opportunity to explain such statements. Even if the panel's inclusion of the statements in the footnote to the final hearing report was a deviation from the rules and procedures set out in Supreme Court Rule 211(e), we have stated that any deviation from the rules and procedures does not constitute a defense in a disciplinary proceeding and is not grounds for dismissal absent a clear and convincing showing of actual prejudice to the respondent. Supreme Court Rule 224 (2007 Kan. Ct. R. Annot. 364). Here, the complained of statements have to do with the settlement of the Johnsons' claim against the Respondent and the allegation that, as part of their settlement agreement, the Respondent made the Johnsons agree not to voluntarily testify against him at the disciplinary hearing. Mr. Johnson's assessment of their settlement agreement containing such a provision was uncontroverted testimony presented at the disciplinary hearing. Moreover, the Respondent himself stated, I remember raising it as a condition of settlement that I wanted them to withdraw all complaints. Panel member Claus then asked the Respondent, I guess my questionmy direct question was whether or not you raised as a condition of settlement that they not voluntarily testify at this proceeding. The Respondent answered, It's possible. Consequently, the evidence presented at the disciplinary hearing already established the Respondent's attempts to prevent the Johnsons from testifying against him at the disciplinary hearing. Further, the Respondent was given an opportunity to defend himself against such accusations and explain the context, if any, of such a condition of the settlement agreement, or dispute its existence. The Respondent failed to do so. No matter what the Respondent's intentions were in making the complained of statements to Ms. Harris, or even whether he in fact made such statements, the evidence presented was clear that the Respondent had attempted to get the Johnsons to agree not to testify against him at a disciplinary hearing. As such, the Respondent has failed to establish any real prejudice by the panel's inclusion of the complained of statements in the footnote to the final hearing report. Settlement as a Mitigating Factor The Respondent argues the panel erred in concluding that the Johnsons' letter was compelled through the settlement of the case and, therefore, was not a mitigating factor. He argues further that even if the letter is deemed compelled through the settlement of the case, there is still no clear and convincing evidence to conclude that it was not voluntary since the settlement, itself, was voluntary. The Respondent is correct that [a]ny attorney misconduct must be established by substantial, clear, convincing, and satisfactory evidence. In re Comfort, 284 Kan. at 190, 159 P.3d 1011, citing In re Lober, 276 Kan. 633, 636, 78 P.3d 442 (2003). However, the Respondent cites no authority for his position that each aggravating and mitigating factor must be supported by clear and convincing evidence. Rather, the panel must consider the evidence presented with respect to aggravating and mitigating circumstances and determine how much weight to assign to each in arriving at an appropriate discipline. Here, it appears the panel did consider the Johnsons' letter, but decided not to give it much weight as a mitigating factor because it was compelled as part of a settlement. Although the Respondent is correct that it would appear the Johnsons' decision to enter into a settlement agreement was voluntary, the panel found their letter expressing satisfaction with restitution and requesting no discipline was compelled as a condition of the settlement. Mr. Johnson testified that the release was negotiated, that he had to make concessions in order to get paid, and that getting paid was his major consideration. There was ample evidence presented to support the panel's finding that the letter was compelled and this court should not reweigh the evidence. As such, the panel did not err in failing to give weight to the letter as a mitigating factor. Subject Matter Jurisdiction The Respondent contends the hearing panel did not have subject matter jurisdiction in this case both because the complained of conduct pertains to actions occurring outside the practice of law and in Missouri, rather than in Kansas. Petitioner cites Kansas case precedent where attorneys were disciplined for actions that occurred outside of the practice of law. In In re Kershner, 250 Kan. 383, 388, 827 P.2d 1189 (1992), a non-practicing attorney was disciplined after being convicted of two felony convictions for selling unregistered securities. However, as Respondent points out, the attorney in Kershner was charged with violating MRPC 8.4 (now KRPC 8.4), which provides in relevant part: It is professional misconduct for a lawyer to: . . . . (b) commit a criminal act that reflects adversely on the lawyer's honesty, trustworthiness or fitness as a lawyer in other respects; (c) engage in conduct involving dishonesty, fraud, deceit or misrepresentation; . . . . (g) engage in any other conduct that adversely reflects on the lawyer's fitness to practice law. 1991 Kan. Ct. R. Annot. 308. Here, while the Respondent was not charged with committing a criminal act under KRPC 8.4(b), he was charged with violating KRPC 8.4(c). Accordingly, the hearing panel would have the same jurisdiction to examine the issue as was present in Kershner. The fact that the hearing panel ultimately did not find the Respondent had violated KRPC 8.4(c) does not affect the jurisdiction of the panel to consider the issue in the first place. As such, the hearing panel had jurisdiction to consider the complaint in this case. The Respondent seems to focus only on the fact he was charged with violating KRPC 4.1(a), which does appear to require the lawyer to be practicing law, as it deals with making false statements in the course of representing a client. Regardless, evidence was presented to establish that the Respondent was practicing law. The most direct evidence of the Respondent's role as an attorney representing Lynn Steeley Estate Sales can be found in his letter to Lance Weber, an attorney representing the Johnsons, dated March 10, 2006. In that letter, the Respondent states: This letter is sent in my capacity as counsel for Lynn Steely, Inc., d/b/a/ Lynn Steely Estate Sales. The Respondent then proposes a settlement agreement with the Johnsons for the above-stated matter. As such, evidence established that even the Respondent, himself, viewed his role as that of an attorney for the company. Further, evidence established the Respondent knowingly made a false statement of fact when he intentionally informed McKinney that he had forwarded the requested materials (the accounting, the key to Weiss' home, and the buyout receipts) on January 18, 2006. The Respondent attempts to argue that he was practicing law only when he issued letters written on firm letterhead and that he was not acting as an attorney in his negotiations with McKinney over the Weiss complaint. However, the evidence indicates the Respondent was serving as counsel for Lynn Steely Estate Sales in negotiating settlements between the company and Weiss and the Johnsons. Consequently, the evidence indicates the complained of actions by the Respondent did occur while engaging in the practice of law. Additionally, violations of KRPC 3.4(f) and Supreme Court Rule 207(b) do not require the Respondent to have been practicing law. Rather, KRPC 3.4(f) prohibits a lawyer from requesting persons other than clients to refrain from voluntarily giving relevant information to another party, and Rule 207(b) requires only that a lawyer cooperate in disciplinary investigations. Consequently, the hearing panel clearly had subject matter jurisdiction to determine whether or not the Respondent had violated the rules of professional conduct for attorneys and the Supreme Court Rules, regardless of whether the actions in question occurred while practicing law. Further, we have previously determined that Kansas attorneys can be disciplined for conduct committed outside of Kansas. Supreme Court Rule 201 (2007 Kan. Ct. R. Annot. 257) establishes the jurisdiction of the court, and therefore, the jurisdiction of the hearing panel, and states: Any attorney admitted to practice law in this state and any attorney specially admitted by a court of this state for a particular proceeding is subject to the jurisdiction of the Supreme Court and the authority hereinafter established by these Rules. 2007 Kan. Ct. Rules Annot. 257. Petitioner cites In re Arnold, 274 Kan. 761, 762, 56 P.3d 259 (2002), for the proposition that [t]he jurisdiction of the Kansas Supreme Court and the Kansas Board for Discipline of Attorneys is not limited to practice in the state courts of Kansas. Although the Respondent is correct that Arnold is somewhat distinguishable in that it dealt with the court's jurisdiction over the actions of an attorney occurring before a federal court in Kansas, rather than before a state court, there is still nothing limiting the jurisdiction of this court over the actions of an attorney admitted to practice law in Kansas merely because those actions occur in another state. See In re Eastepp, 258 Kan. 766, 907 P.2d 842 (1995) (attorney suspended for 1 year from practice of law in Kansas for actions that occurred in Colorado). Accordingly, the Respondent's claim that the hearing panel and this court lack subject matter jurisdiction over the complained of actions lacks merit. Sufficiency of Evidence The Respondent contends the hearing panel did not have a sufficient basis to determine that he violated KRPC 4.1 and KRPC 8.4(c). In his reply brief, the Respondent also claims there was an insufficient basis for the hearing panel to determine he had violated KRPC 3.4(f). Throughout this issue in his briefs, the Respondent sometimes refers to Rule 8.2 or 8.2(c). However, there was no allegation or finding that the Respondent violated KRPC 8.2 (2007 Kan. Ct. R. Annot. 557) (judicial and legal officials). Moreover, KRPC 8.2(c) does not exist. As such, it appears the Respondent meant to refer to KRPC 8.4(c). While the Disciplinary Administrator alleged the Respondent had violated KRPC 8.4(c), the hearing panel did not find a violation of 8.4(c). Accordingly, the only issue to be determined is whether a sufficient basis existed to support the hearing panel's finding that the Respondent violated KRPC 4.1(a) and 3.4(f). In his brief, the Respondent acknowledged there was a sufficient basis to conclude he was not cooperative with the disciplinary investigation, in violation of Supreme Court Rule 207. Again, KRPC 4.1(a) provides that [i]n the course of representing a client a lawyer shall not knowingly . . . make a false statement of material fact or law to a third person. Here, the evidence established that the Respondent was representing himself and Lynn Steely Estate Sales in negotiating with McKinney and he knowingly and intentionally informed McKinney that he had forwarded requested materials, i.e. the accounting, the key to Weiss' home, and the buy out receipts, on January 18, 2006. In fact, the Respondent had not mailed out the requested items and, instead, sent out a letter on January 19, 2006, offering to settle the matter for $1,375.00. This evidence is sufficient to support the hearing panel's finding that the Respondent violated KRPC 4.1(a). With respect to KRPC 3.4(f), the evidence showed that in negotiating the settlement of the Johnsons' claim against him, the Respondent included a condition that the Johnsons refrain from voluntarily providing testimony in the disciplinary hearing. This evidence is sufficient to support the hearing panel's finding that the Respondent violated KRPC 3.4(f). KRPC 3.4(f) states: A lawyer shall not: . . . . (f) request a person other than a client to refrain from voluntarily giving relevant information to another party unless: (1) the person is a relative or an employee or other agent of a client; and (2) the lawyer reasonably believes that the person's interests will not be adversely affected by refraining from giving such information. (Emphasis added.) 2007 Kan. Ct. R. Annot. 514. The Respondent contends the exception to Rule 3.4(f) is applicable because any condition to refrain from voluntarily testifying was not adverse to the Johnsons' interest and that the panel erred in failing to make any finding with respect to the exception. The Respondent's argument, however, ignores the first requirement of the exception. In fact, in quoting KRPC 3.4(f) in his brief, the Respondent takes the language in subsection (1) out of the rule and replaces it with an ellipse. In order for the exception to Rule 3.4(f) to apply, both subsection (1) and subsection (2) must be met. Here, the Johnsons were not a relative or an employee or other agent of Lynn Steely Estate Sales. As such, the exception to Rule 3.4(f) is not applicable and the hearing panel did not err in failing to make a finding as to the exception.