Court Opinion

ID: 4525989
Source: CourtListenerOpinion
Date Created: 2020-04-16 14:18:32.850051+00
Date Added: 2024-06-11T12:13:57.027618
License: Public Domain

2020 WI 37

                  SUPREME COURT         OF   WISCONSIN
CASE NO.:              2019AP1173-D

COMPLETE TITLE:        In the Matter of Disciplinary Proceedings
                       Against Patrick J. Hudec, Attorney at Law:

                       Office of Lawyer Regulation,
                                 Complainant,
                            v.
                       Patrick J. Hudec,
                                 Respondent.

                            DISCIPLINARY PROCEEDINGS AGAINST HUDEC

OPINION FILED:         April 16, 2020
SUBMITTED ON BRIEFS:
ORAL ARGUMENT:

SOURCE OF APPEAL:
   COURT:
   COUNTY:
   JUDGE:

JUSTICES:

NOT PARTICIPATING:

ATTORNEYS:
                                                                    2020 WI 37
                                                            NOTICE
                                              This opinion is subject to further
                                              editing and modification.   The final
                                              version will appear in the bound
                                              volume of the official reports.
No.    2019AP1173-D

STATE OF WISCONSIN                        :              IN SUPREME COURT

In the Matter of the Disciplinary Proceedings
Against Patrick J. Hudec, Attorney at Law:

Office of Lawyer Regulation,                                      FILED
             Complainant,                                    APR 16, 2020
v.                                                               Sheila T. Reiff
                                                             Clerk of Supreme Court
Patrick J. Hudec,

             Respondent.

      ATTORNEY    disciplinary    proceeding.        Attorney's         license

suspended.

      ¶1   PER CURIAM.      We review a report filed by Referee James

J. Winiarski, accepting a stipulation executed by Attorney Patrick

J. Hudec and the Office of Lawyer Regulation (OLR), in which

Attorney Hudec pled no contest to four counts of professional

misconduct and agreed that the allegations of the OLR's complaint

were established by clear, satisfactory, and convincing evidence.

Consistent with the terms of the stipulation the referee recommends

we suspend Attorney Hudec's law license for 60 days and require
Attorney Hudec to attend an OLR trust account seminar within one
                                                                     No.    2019AP1173-D

year.      The referee also recommends we order Attorney Hudec to pay

the full costs of this proceeding, which total $3,991.10 as of

January 29, 2020.         The OLR did not request restitution and no

restitution is ordered.

      ¶2     We adopt the referee's findings of fact and conclusions

of law as derived from the parties' stipulation.                     We agree that a

60-day suspension is appropriate and we direct Attorney Hudec to

attend an OLR trust account seminar within one year of the date of

this order as a condition of his continued practice of law.                           We

impose the full costs of this proceeding on Attorney Hudec.

      ¶3     Attorney Hudec was admitted to the practice of law in

Wisconsin in 1979.       As the referee observed, Attorney Hudec has an

extensive disciplinary history.

     In November 1989, Attorney Hudec consented to a private

      reprimand     for       misconduct       that     included       accepting       a

      representation that was adverse to a former client and which

      constituted a conflict of interest.                 Private Reprimand No.

      1989-27.
     In March 1993, Attorney Hudec consented to a second private

      reprimand    for    misconduct       that      included    entering      into    a

      business    transaction      that       was    adverse    to    the    financial

      interests     of    a    client;     engaging      in     conduct      involving

      dishonesty,        fraud,    deceit       or     misrepresentation;           and

      withholding material evidence in failing to cooperate with

      the investigation of the Board of Attorneys Professional

      Responsibility.         Private Reprimand No. 1993-4 (electronic

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                                                                 No.     2019AP1173-D

    copy       available       at            https://compendium.wicourts.gov/

    app/raw/002076.html).

   In May 2001, a third consensual private reprimand was imposed

    on Attorney Hudec for misconduct that included failing to

    obtain written consent to a potential conflict of interest in

    representing two clients and drafting a letter that contained

    a false statement of fact.               Private Reprimand No. 2001-15.

   In     2008,    Attorney   Hudec         received    a    consensual       public

    reprimand for misconduct that included failing to act with

    reasonable diligence; failing to communicate with his client;

    and failing to cooperate with the OLR's investigation. Public

    Reprimand of Patrick J. Hudec, No. 2008-2 (electronic copy

    available                       at                       https://compendium.

    wicourts.gov/app/raw/002005.html).

   In July 2014, we publicly reprimanded Attorney Hudec for four

    counts of misconduct to which Attorney Hudec had stipulated,

    including breach of his duty of competence, submitting a brief

    with    inappropriate      facts,        and   engaging    in   an    ex   parte
    communication.      In re Disciplinary Proceedings Against Hudec,

    2014 WI 46, 354 Wis. 2d 728, 848 N.W.2d 287.

   On April 18, 2019, this court suspended Attorney Hudec's

    Wisconsin law license for 60 days, effective May 30, 2019,

    for six counts of misconduct to which Attorney Hudec pled no

    contest.       In re Disciplinary Proceedings Against Hudec, 2019
WI 39, 386 Wis. 2d 371, 925 N.W.2d 540.                      His misconduct

    involved       shortcomings     in       his   fee   agreements;       lack    of

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                                                                 No.     2019AP1173-D

     diligence; failure to communicate with clients; and failure

     to comply with discovery rules.

     ¶4        This disciplinary matter commenced on June 27, 2019,

when the OLR filed a complaint against Attorney Hudec alleging

four counts of professional misconduct.                 Referee Winiarski was

appointed on August 7, 2019.             Attorney Hudec failed to file a

timely answer in this matter, so on October 1, 2019, the OLR sought

a default judgment.

     ¶5        On October 28, 2019, Attorney Hudec and the OLR entered

into a stipulation in which Attorney Hudec pled no contest to all

the allegations of misconduct.           In the stipulation Attorney Hudec

stated that his delays in responding to and/or cooperating with

the OLR were medically related as a result of a lengthy illness

during the summer of 2019, and major back surgery in January of

2018.     The parties confirmed that the stipulation was not the

result of plea bargaining but reflects Attorney Hudec's voluntary

decision not to contest this matter.                Attorney Hudec represents

and verifies that he fully understands the allegations to which he
stipulated in this disciplinary matter; he fully understands his

right     to    contest     this   matter;     he     fully     understands        the

ramifications        of   his   entry   into    the   stipulation;           he   fully

understands that he has the right to consult counsel; and that his

entry into the stipulation was made knowingly and voluntarily.

     ¶6        The   referee    requested      briefing       from     the    parties

regarding Attorney Hudec's previous misconduct; caselaw supporting

the recommended 60-day license suspension; and evidence and/or
agreement regarding Attorney Hudec's medical conditions.                          After
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                                                                     No.    2019AP1173-D

consideration of the OLR's supplemental brief, the referee issued

his report on January 9, 2020.               No appeal from that report was

filed so we consider this matter pursuant to SCR 22.17(2).1

     ¶7     The facts found by the referee derive from the parties'

stipulation.       On January 17, 2017, the OLR received a notice of an

overdraft on Attorney Hudec's trust account. The OLR subsequently

received notice of several additional overdrafts.                          A review of

Attorney Hudec's trust account statements revealed that Attorney

Hudec disbursed funds from his trust account dozens of times to

pay personal and/or law firm expenses.                During the same period of

time, Attorney Hudec made trust account checks payable to "cash"

and/or made cash withdrawals from his trust account on multiple

occasions.

     ¶8     Attorney Hudec then failed to cooperate with the OLR. On

September    6,    2017,   the    OLR   sent   a     letter    to    Attorney     Hudec

requesting that he submit a written response to its investigation.

Attorney Hudec did not timely respond.               He requested extensions of

time to respond, but then repeatedly failed to meet the extended
deadlines    and    failed   to    provide     the    OLR     with    the    requested

information despite the OLR's multiple attempts to contact him.

     1   SCR 22.17(2) provides:

          If no appeal is filed timely, the supreme court
     shall review the referee's report; adopt, reject or
     modify the referee's findings and conclusions or remand
     the matter to the referee for additional findings; and
     determine and impose appropriate discipline. The court,
     on its own motion, may order the parties to file briefs
     in the matter.

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                                                            No.   2019AP1173-D

In January 2018, at the OLR's request, this court issued an order

to show cause as to why Attorney Hudec's license should not be

temporarily suspended for failing to cooperate with the OLR's

investigation.   This apparently prompted Attorney Hudec to provide

the OLR with enough information, so at the OLR's request, the

motion was withdrawn.

      ¶9    In June 2018, the OLR sought additional information from

Attorney Hudec and again, he failed to timely respond, requested

extensions of time, and then again failed to respond. In September

2018, at the request of the OLR, we issued another order requiring

Attorney Hudec to show cause why his law license should not be

temporarily   suspended   for   failure    to   cooperate    with   the   OLR

investigation.      Attorney    Hudec     requested   and     received    two

extensions of time from this court but nonetheless failed to timely

respond to our order.     On November 8, 2018, Attorney Hudec finally

provided the OLR with sufficient information so the OLR withdrew

its motion.

      ¶10   The referee concluded that Attorney Hudec committed four
counts of professional misconduct:

     Count 1: By depositing and retaining funds belonging to
      himself or his law firm in his trust account, Attorney
      Hudec violated SCR 20:1.15(b)(3).2

      2SCR 20:1.15(b)(3) provides: "No funds belonging to the
lawyer or law firm, except funds reasonably sufficient to pay
monthly account service charges, may be deposited or retained in
a trust account."

                                   6
                                                   No.   2019AP1173-D

     Count 2: By making trust account checks payable to
      "cash" and by making cash withdrawals from his trust
      account, Attorney Hudec violated SCR 20:1.15(f)(2)a.3

     Count 3: By having trust account checks returned for
      insufficient funds, and therefore disbursing funds from
      his trust account without the funds being available for
      disbursement,     Attorney    Hudec     violated    SCR
      20:1.15(f)(4)a.4

     Count 4: By willfully failing to provide the OLR with
      a timely initial written response to the OLR Matter no.
      2017MA1283, and by willfully failing to provide the OLR
      a timely response to its June 26, 2018 request for
      additional   information,   Attorney   Hudec   violated

      3SCR 20:1.15(f)(2)a. provides: "No withdrawal of cash shall
be made from a trust account or from a deposit to a trust account.
No check shall be made payable to 'Cash.' No withdrawal shall be
made from a trust account by automated teller or cash dispensing
machine."
      4SCR 20:1.15(f)(4)(a) provides: "A lawyer shall not disburse
funds from any trust account less the deposit from which those
funds will be disbursed has cleared, and the funds are available
for disbursement."

                                 7
                                                        No.     2019AP1173-D

     SCR 22.03(2)5        and   22.03(6),6     enforceable        via
     SCR 20:8.4(h).7
     ¶11    Determining    appropriate   discipline   for     professional

misconduct involves: (1) the seriousness, nature, and extent of

the misconduct; (2) the level of discipline needed to protect the

public, the courts, and the legal system from repetition of the

attorney's misconduct; (3) the need to impress upon the attorney

the seriousness of the misconduct; and (4) the need to deter other

attorneys from committing similar misconduct.         In re Disciplinary

Proceedings Against Hammis, 2011 WI 3, ¶39, 331 Wis. 2d 19, 793
N.W.2d 884.

     5   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.
     6 SCR 22.03(6) provides: "In 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."
     7 SCR 20:8.4(h) provides: "It is professional misconduct for
a lawyer to fail to cooperate in the investigation of a grievance
filed with the office of lawyer regulation as required by SCR
21.15(4), SCR 22.001(9)(b), SCR 22.03(2), SCR 22.03(6), or SCR
22.04(1)."

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                                                                     No.     2019AP1173-D

       ¶12    It is clear from the report that the referee questioned

whether a 60-day suspension is adequate given Attorney Hudec's

disciplinary history and the facts of this matter.                         The referee

thus requested additional information from the parties.                         The OLR

submitted a memorandum.           Attorney Hudec did not respond.

       ¶13    The OLR's memorandum indicates that Attorney Hudec did

not provide evidence to establish that the medical conditions he

described caused his misconduct.               In re Disciplinary Proceedings

Against      Sosnay,    209 Wis. 2d 241,     243,      562 N.W.2d 137     (1997)

("Absent      a   causal      connection    between       an    attorney's      medical

condition and that attorney's professional misconduct, the medical

condition may not be considered a factor mitigating either the

seriousness of the misconduct or the severity of discipline to be

imposed for it.")       The OLR confirmed that Attorney Hudec's medical

concerns did not mitigate the proposed discipline.

       ¶14    At the referee's request, the OLR also addressed the

concept of progressive discipline in light of Attorney Hudec's

lengthy history of disciplinary offenses.                  The OLR confirmed that
it    had    factored   progressive        discipline      into     its    recommended

sanction, citing a number of cases in which an attorney with prior

discipline was suspended for 60 days for misconduct that amounted

to commingling of funds and prohibited trust account transactions.

See, e.g., In re Disciplinary Proceedings Against Runyon, 2015 WI
95,    365 Wis. 2d 32,      870 N.W.2d 228;      and      In   re     Disciplinary

Proceedings       Against     Grogan,   2011 WI 7,     331 Wis. 2d 341,     795
N.W.2d 745.

                                           9
                                                        No.   2019AP1173-D

     ¶15 The referee was particularly troubled by Attorney Hudec's

persistent   failure    to   cooperate,      both   during    the   OLR's

investigation and during the proceedings before the referee.           The

referee observed:

     It is safe to conclude that the respondent knowingly and
     deliberately delays and drags his feet before giving
     proper attention to disciplinary matters. A prior 60-
     day license suspension, three prior private reprimands,
     and two prior public reprimands apparently have not
     convinced the respondent of the need to fully and timely
     cooperate in OLR investigations and disciplinary
     matters.
However, the referee noted that there was no evidence that any of

Attorney   Hudec's   misconduct   resulted    in    misappropriation    or

conversion of client funds; rather, Attorney Hudec's misconduct

amounted to bookkeeping or accounting deficiencies.

     ¶16   On balance, informed by Wisconsin caselaw, supplemental

briefing provided by the OLR, and the ABA Standards for Imposing

Lawyer Sanctions, the referee accepted the proposed sanctions and

recommends this court suspend Attorney Hudec's law license for a

period of 60 days and require him to attend the OLR's trust account

management seminar within one year of the date of this order.          The

referee also recommends we impose the full costs of this proceeding

on Attorney Hudec.

     ¶17   Considering all of the above, we accept the referee's

findings of fact and conclusions of law as derived from the

stipulation, and we agree with the recommended sanctions and the

imposition of costs. We share the referee's concern about Attorney
Hudec's troubling propensity for delay and lack of cooperation in

                                  10
                                                     No.   2019AP1173-D

disciplinary matters and warn Attorney Hudec that his failure to

comply with the conditions imposed upon his continued practice of

law may subject Attorney Hudec to immediate license suspension.8

     ¶18   IT IS ORDERED that the license of Patrick J. Hudec to

practice law in Wisconsin is suspended for a period of 60 days,

effective May 28, 2020

     ¶19   IT IS FURTHER ORDERED that if he has not already done

so, Patrick J. Hudec shall comply with the provisions of SCR 22.26

regarding the duties of a person whose license to practice law in

Wisconsin has been suspended.

     ¶20   IT IS FURTHER ORDERED that, as a condition of his license

to practice law in Wisconsin, Patrick J. Hudec shall attend and

successfully complete an Office of Lawyer Regulation trust account

seminar within one year of the date of this order.

     ¶21   IT IS FURTHER ORDERED that if Patrick J. Hudec fails to

timely complete the requirement that he attend an Office of Lawyer

Regulation trust account seminar, the Office of Lawyer Regulation

is directed to inform this court promptly and Patrick J. Hudec's
law license may be subject to immediate suspension.

     ¶22   IT IS FURTHER ORDERED that within 60 days of the date of

this order, Patrick J. Hudec shall pay to the Office of Lawyer

Regulation the costs of this proceeding, which are $3,991.10 as of

January 29, 2020.

     8 Attending the trust account management seminar within a year
is not a prerequisite to Attorney Hudec's reinstatement from the
suspension we impose today.

                                 11
    No.   2019AP1173-D

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