Court Opinion

ID: 3160039
Source: CourtListenerOpinion
Date Created: 2015-12-04 15:08:42.436113+00
Date Added: 2024-06-11T12:16:54.361550
License: Public Domain

IN THE SUPREME COURT OF IOWA
                              No. 15–1391

                         Filed November 20, 2015

IOWA SUPREME COURT ATTORNEY DISCIPLINARY BOARD,

      Complainant,

vs.

ALEXANDRA M. NELISSEN,

      Respondent.

      On review of the report of the Grievance Commission of the

Supreme Court of Iowa.

      The grievance commission recommends suspension of an attorney

for several violations of the rules of professional conduct and rules

regarding client trust accounts. LICENSE SUSPENDED.

      Charles L. Harrington, Wendell J. Harms, and Susan Wendel, Des

Moines, for complainant.

      Alexandra M. Nelissen, Des Moines, pro se.
                                    2

MANSFIELD, Justice.

      This matter comes to us on a report of a division of the Grievance

Commission of the Supreme Court of Iowa.       See Iowa Ct. R. 35.11(1).

The Iowa Supreme Court Attorney Disciplinary Board charged attorney

Alexandra M. Nelissen with violating several ethical rules.         The

commission held a hearing, found that some but not all the alleged

violations had occurred, and recommended a thirty-day suspension. On
our review, we essentially track the well-reasoned analysis of the

commission.    That is, we agree that trust account violations occurred,

that Nelissen made misrepresentations on her 2014 client security

questionnaire, and that Nelissen improperly increased her hourly rate

without notice to her client. Like the commission, we reject the other

alleged violations. We also agree with the commission’s recommended

sanction and, therefore, suspend Nelissen’s license to practice law in

Iowa for thirty days.

      I. Background Facts and Proceedings.

      Nelissen has practiced law in Iowa since 2001. In 2011, Nelissen

was a partner in the law firm of Nelissen & Juckette, P.C.

      In August of that year, Nelissen was contacted by Linda Almburg.
The Child Support Recovery Unit (CSRU) had notified Almburg that it

intended to seek modification of the child support her ex-spouse was

paying under a 2007 dissolution decree. In that decree, the parties had

been awarded shared physical care of their two minor children, but

Almburg’s ex-husband had been ordered to pay $660 per month in child

support to Almburg based on his substantially higher income.      CSRU

proposed a modification under which Almburg would pay approximately

$350 per month in child support instead of receiving $660 per month.

Almburg not only was concerned about this proposed change in child
                                          3

support, she also wanted to look into altering the children’s physical care

arrangements.

       At the initial client meeting, Nelissen and Almburg agreed upon a

$3500 advance retainer. Almburg gave Nelissen a $2500 check at that

time. Nelissen deposited the $2500 into the firm’s client trust account.

Almburg understood that Nelissen would bill for her services at a rate of

$150 per hour. Although Nelissen prepared a written fee agreement, no
such agreement was ever signed by Almburg.

       On September 14, CSRU filed its request for a chapter 252H

hearing to modify child support.          See Iowa Code § 252H.8 (2011).             A

hearing was originally scheduled for January 4, 2012. This hearing date

was continued several times—once because Nelissen was going to be out

of town meeting her son who was returning from a Marine Corps

deployment to Afghanistan and once because of Nelissen’s medical

condition.    Additional continuances occurred because CSRU’s counsel

had a conflict and because Almburg’s ex-spouse refused to provide

discovery. The ex-spouse was sanctioned for this conduct and ordered to

pay $250 toward Nelissen’s attorney’s fees. The 2007 child support order

remained in effect pending the hearing.1
       Almburg was unhappy with the delays in the proceeding.                     She

frequently emailed and texted Nelissen, who often responded promptly to

those communications.

       On October 4, 2012, the hearing finally took place on CSRU’s

requested modification of child support. Nelissen represented Almburg

at the hearing, and Almburg’s ex-spouse also appeared through an

       1As a further sanction for the ex-spouse’s misconduct in discovery, the district

court ordered that any modification of support would not be retroactive.
                                            4

attorney. Almburg prevailed—the district court declined to modify child

support. As the court explained,

       The Court finds that the Respondent’s current “hardship”
       based on his financial condition is largely attributable to the
       Respondent’s actions in pursuing underemployment
       activities while at the same time maintaining his unwavering
       desire to maintain a lifestyle inconsistent with his financial
       station.

       Meanwhile, Nelissen had sent two itemized invoices to Almburg on

behalf of the Nelissen & Juckette law firm.                     The invoices totaled

$1097.62. The invoices appeared to indicate that Nelissen was seeking

payment of $1097.62 in addition to the $2500 on deposit.2 It is unclear
to this day what happened to the $2500 retainer provided to the Nelissen

& Juckette law firm.

       In February 2012, Nelissen had split off from Jolie Juckette and

gone into practice on her own.             On June 12, Almburg delivered the

balance of the original $3500 retainer (i.e., $1000) to Nelissen

individually. The $1000 was not deposited into Nelissen’s trust account.

A week later, on June 19, Nelissen sent Almburg an invoice on behalf of

her solo firm showing $2484.22 worth of work performed since February.

The $1000 was treated as a credit, so the “current balance due and
owing” was shown as $1484.22. Significantly, the hourly rate was now

$200 rather than $150; Nelissen had not previously informed Almburg of

this rate change.        Even so, on July 23, Almburg paid Nelissen the

$1484.22.

       On November 6, following the successful outcome of the October

child support modification hearing, Nelissen billed Almburg for an

      2In fact, the second invoice, which was labeled a “pre-bill,” included a late fee for

nonpayment of the first invoice. This late fee, however, was later removed.
                                     5

additional $4420 in fees and $.90 in costs covering the June through

October time period.     Giving credit for payment of the $250 court

sanctions by Almburg’s ex-spouse, the amount shown due was now

$5655.12 despite the prior $1484.22 payment.           The record does not

indicate that Almburg paid any portion of this bill.

      In July 2013, a special audit was performed on the client trust

account at Nelissen’s new solo firm. Nelissen provided the auditor with
monthly bank statements, her general trust account ledger, copies of

individual client ledger records, and copies of client billings. However,

she did not provide monthly reconciliation statements or lists of client

balances.

      In June 2014, after the Board had received a complaint from

Almburg, a further audit was conducted.           At the audit, Nelissen

produced monthly bank statements, the general trust ledger, and

individual client ledger records.    However, she still had no monthly

reconciliations or lists of client balances tied to reconciled bank

statement balances.

      With respect to the Almburg representation in particular, Nelissen

claimed the $2500 retainer had been used up while she was in legal
partnership with Juckette. However, she had no documentation of this,

nor any trust account documentation relating to Almburg.          Nelissen

promised to provide this documentation at a later date but never did so.

Nelissen maintains that the Almburg billing file, which she received upon

separating her practice from Juckette, was empty. Nelissen also failed to

respond to a number of inquiries from the Board.

      In her client security questionnaires filed in 2011, 2012, 2013, and

2014, Nelissen certified that reconciliations of trust account balances

with bank statement balances and individual client ledger balances were
                                    6

performed monthly. She also certified that books and records relating to

client funds were preserved for at least six years after completion of the

employment to which they related.

      Following its investigation, the Board charged Nelissen with

violating aspects of Iowa Rules of Professional Conduct 32:3.2 (expediting

litigation), 32:1.4 (communication), 32:1.5 (fees), 32:1.15 (safekeeping

property), 32:8.1 (disciplinary matters), and 32:8.4 (misconduct), as well
as Iowa Court Rules 45.1, 45.2, and 45.7 relating to trust accounts. A

full-day hearing was held before the commission on June 10, 2015. On

August 12, the commission issued a concise yet thorough report of

findings of fact, conclusions of law, and recommended sanction.        The

commission concluded that some but not all the alleged violations had

occurred and recommended a thirty-day suspension of Nelissen’s license

to practice law.

      II. Standard of Review.

      As we recently summarized,

      We review attorney disciplinary matters de novo. Attorney
      misconduct must be proven by a convincing preponderance
      of the evidence. We respectfully consider the commission’s
      findings and recommendations, but are not bound by them.
      Upon a finding of misconduct, we may impose a greater or
      lesser sanction than recommended by the commission.

Iowa Supreme Ct. Att’y Disciplinary Bd. v. Said, 869 N.W.2d 185, 190

(Iowa 2015) (citations omitted) (internal quotation marks omitted).

      III. Violations.

      We begin our discussion with the alleged violations that were not

proved by the Board.     The Board charged that Nelissen violated Iowa

Rule of Professional Conduct 32:3.2 by failing to make reasonable efforts

to expedite litigation consistent with the interests of the client. It also

alleged she violated rule 32:1.4 by failing to keep her client reasonably
                                       7

informed and failing to respond to her client’s reasonable requests for

information.        Iowa R. Prof’l Conduct 32:1.4.   Finally, it alleged she

violated rule 32:1.5(a) prohibiting the charging of an unreasonable fee.

Id. r. 32:1.5(a).

       We agree with the commission that these alleged violations were

not established by a convincing preponderance of the evidence.

Nelissen’s reasons for seeking continuances were justified, and the
continuances were brief and nonprejudicial.      We also cannot conclude

that Nelissen’s communication with Almburg was so deficient as to

amount to an ethical violation.        Rather, we concur in the following

assessment by the commission:

       The emails reflect a stressed client taking an active interest
       in her child support modification matter and asking
       pertinent questions about the proceedings. Nelissen was not
       always prompt in responding to [Almburg’s] emails.
       Nevertheless, the record shows that Nelissen normally
       responded to emails from [Almburg] the same day or within
       one or two days.

Similarly, we agree with the commission that an improper $12.61 late

charge on a “pre-bill” that was subsequently removed does not constitute

a violation of rule 32:1.5(a).

       However, we uphold the violations that the commission found.

Rule 32:1.5(b) requires that “[a]ny changes in the basis or rate of the fee

or expenses shall also be communicated to the client.” Id. r. 32:1.5(b).

In February 2012, Nelissen increased her hourly rate by 33⅓% to $200

per hour. Yet she did not inform her client of this change, other than by

using the new rate in her billing. This oversight violated rule 32:1.5(b).

       More serious are the trust account violations.      The commission

found, as do we, that Nelissen breached various ethical rules relating to

trust accounts by mishandling funds she received from Almburg.
                                           8

Nelissen never communicated to Almburg that withdrawals were being

made from the initial $2500 retainer. See Iowa Ct. R. 45.7(4) (requiring

contemporaneous or advance notification with a complete accounting);

Iowa Supreme Ct. Att’y Disciplinary Bd. v. Santiago, 869 N.W.2d 172, 180

(Iowa 2015). She also failed to deposit the $1000 balance of the retainer

in her client trust account.        See Iowa R. Prof’l Conduct 32:1.15(a), (c)

(requiring maintenance of client funds in a separate account and their
withdrawal only as fees are earned or expenses incurred); Iowa Ct. Rs.

45.1, .7(3) (imposing similar but more detailed requirements); Santiago,
869 N.W.2d at 180. Additionally, although the commission did not make

a specific finding on this point, we find by a convincing preponderance of

the evidence that withdrawals were made from the $2500 retainer before

the funds were actually earned.3

       Furthermore, Nelissen violated rule 45.2(3) by failing to retain for

six years billing and trust account records relating to the Almburg

representation and failing to make reasonable arrangements to retain

those records when her partnership with Juckette dissolved. See Iowa

Ct. R. 45.2(3)(a), (d) (requiring retention of billing trust account records

for six years and requiring that when a law firm dissolves, “the partners
shall make reasonable arrangements for the maintenance of the records

       3We  do not agree with the commission that Nelissen’s failure to deposit the
$1484.22 in her client trust account was an additional violation. This was a payment
on a bill for services previously rendered. Although Nelissen later accepted that
Almburg was entitled to a credit for the unaccounted $2500 retainer, a
contemporaneous memo confirms that neither Nelissen nor Almburg viewed the
$1484.22 as an advance payment at the time.
       We share the commission’s view that “there is no evidence that Nelissen’s
actions amount to conversion or misappropriation of any funds in her client trust
account.” As stated by the commission, “Nelissen’s violations of the trust account rules
appear to stem from sloppy record keeping and a disorganized separation of her legal
practice with Juckette.”
                                          9

specified in this rule”). Although it is not clear exactly what happened to

those records for the time period before the two law partners went their

separate    ways,   it   is    apparent       that   Nelissen   made   insufficient

arrangements to assure their preservation. Nelissen also committed an

ethical violation by not performing monthly reconciliations of her bank

statements with client trust account records.              See id. r. 45.2(3)(a)(9)

(requiring attorneys to maintain and retain monthly reconciliations);
Iowa Supreme Ct. Att’y Disciplinary Bd. v. Eslick, 859 N.W.2d 198, 201

(Iowa 2015).

        Like the commission, we also find Nelissen violated rule 32:8.4(c)

by misrepresenting on her 2014 client security report that she was

performing monthly reconciliations of her trust account balances with

bank statements. See Iowa R. Prof’l Conduct 32:8.4(c). While the record

may be somewhat inconclusive for earlier years, it is clear that after she

went into practice on her own Nelissen knew her firm was not doing

monthly reconciliations, even though she claimed it was.                  See Iowa

Supreme Ct. Att’y Disciplinary Bd. v. Kersenbrock, 821 N.W.2d 415, 421

(Iowa    2012)   (finding     an   attorney     engaged    in   conduct   involving

misrepresentation by misstating the status of her trust account practices
in her annual client security questionnaires).

        Additionally, we join the commission in determining that Nelissen

violated rule 32:8.1(b) by ignoring requests of the Board for information.

Between January and May 2014, the Board sent a series of letters to

Nelissen, as to which it received no response. See Iowa R. Prof’l Conduct

32:8.1(b) (making it an ethical violation to “knowingly fail to respond to a

lawful demand for information from an admissions or disciplinary

authority”); Iowa Supreme Ct. Att’y Disciplinary Bd. v. Lemanski, 841
N.W.2d 131, 133 (Iowa 2013). We can infer from the repetition of the
                                    10

behavior that Nelissen “knowingly” failed to respond. See Iowa Supreme

Ct. Att’y Disciplinary Bd. v. Netti, 797 N.W.2d 591, 604–05 (Iowa 2011).

       IV. Sanctions.

       Regarding sanctions, we are guided by the following principles:

              There is no standard sanction for particular types of
       misconduct. In the imposition of sanctions, we consider the
       violations at issue, the need to deter future violations, the
       protection of the public, the reputation of the bar, the
       attorney’s fitness to practice law, and aggravating and
       mitigating circumstances.

              ....

             When determining what sanctions to impose, we
       consider those imposed in similar cases while remaining
       aware of the different circumstances in each case.

Said, 869 N.W.2d at 193 (citations omitted) (internal quotation marks

omitted).

       This case mainly involves trust account violations. “Our sanctions

for trust account violations have ranged from a public reprimand to

license revocation.” Iowa Supreme Ct. Att’y Disciplinary Bd. v. Lubinus,

869 N.W.2d 546, 550 (Iowa 2015). There is no indication that Nelissen

misappropriated or converted client funds without a colorable future

claim to those funds—a situation that would warrant revocation. See id.

at 552.     At the other end of the spectrum, we have imposed a public

reprimand for “isolated and minor violations,” or “minor trust account

violations [that] are the result of sloppiness or lack of oversight.” Id. at

550.   Considering the specifics of this case, our precedents, and the

other factors enumerated above, we have decided to suspend Nelissen’s

license to practice law in Iowa for thirty days as recommended by the

commission.
                                           11

       A reprimand would not be appropriate here for several reasons,

including Nelissen’s record of past discipline. In 2012, Nelissen received

a public reprimand primarily for trust account violations that occurred in

2010 and 2011.4 This is a significant aggravating factor. See Eslick, 859
N.W.2d at 203 (noting that an attorney’s “previous public reprimand

makes a suspension [for trust account violations] appropriate in this

case”).     Additionally, during the 2013 audit, the auditor reminded

Nelissen she needed to perform monthly reconciliations, yet this problem

remained at the time of the 2014 audit. Santiago, 869 N.W.2d at 183

(finding “failure to learn” from a prior audit to be an aggravating factor);

see also Iowa Supreme Ct. Att’y Disciplinary Bd. v. Ricklefs, 844 N.W.2d
689, 700 (Iowa 2014) (“Ricklefs knew what he needed to do after the

2008      audit   but   failed   to   do   it.”).   Further,     Nelissen    made     a

misrepresentation on her client security questionnaire—conduct that we

have said “could potentially justify a more severe sanction” than would

otherwise be imposed. Ricklefs, 844 N.W.2d at 702. For these reasons,

another reprimand would not serve the goals of the attorney discipline

process. See Santiago, 869 N.W.2d at 184 (“A mere reprimand on this

record would weaken the deterrence so important to motivating

compliance with our rules that protect the public and maintain

confidence in our legal system.”).

       The commission treated Nelissen’s personal health issues as a

mitigating factor.      See Eslick, 859 N.W.2d at 202.           However, Nelissen

opted not to testify at the hearing so we have very limited information on

those issues and no basis to tie them to her trust account violations. Cf.

      4Additionally, Nelissen’s license was temporarily suspended in 2013 for failure to

pay annual fees, and she received a public reprimand in 2014 for neglect.
                                     12

id. at 202 (discussing the attorney’s testimony about her personal illness

and what she was doing to address it). We do find that lack of client

harm is a mitigating circumstance. See Ricklefs, 844 N.W.2d at 700.

       This case does not involve a pervasive failure to follow trust

account rules. Cf. Iowa Supreme Ct. Att’y Disciplinary Bd. v. Morris, 847
N.W.2d 428, 436, 437 (Iowa 2014) (imposing an indefinite suspension of

at least six months on an attorney whose “record-keeping and
management deficits were severe and . . . persisted over a long period of

time even after the Client Security Commission intervened with an audit”

and who had prior suspensions); Ricklefs, 844 N.W.2d at 700, 702 (Iowa

2014) (imposing an indefinite suspension of at least three months on an

attorney who had “pervasive trust account violations,” including using

his trust account “as a conduit for personal funds,” when the situation

had continued for several years despite a prior audit); Iowa Supreme Ct.

Att’y Disciplinary Bd. v. Powell, 830 N.W.2d 355, 359–60 (Iowa 2013)

(imposing an indefinite suspension of at least three months on an

attorney who was guilty of “years of utter disregard . . . for the trust fund

rules and practices,” while taking into account the attorney’s interim

suspension for seven months for the same conduct); Iowa Supreme Ct.
Att’y Disciplinary Bd. v. Parrish, 801 N.W.2d 580, 589–90 (Iowa 2011)

(imposing a sixty-day suspension on an attorney who repeatedly failed to

account for client funds and whose “conduct over the last ten years has

now developed into a pattern of violating the [ethical and trust account

rules]”).

       To the contrary, the record indicates that Nelissen generally had a

functioning client trust account, kept a client trust account ledger, and

maintained individual client ledger records.        She also competently

represented her client in the matter that is the subject of this complaint.
                                        13

Nelissen     did,    however,     consistently   fail        to     perform       monthly

reconciliations. Additionally, with respect to Almburg, Nelissen failed to

take reasonable steps to preserve records, paid herself out of the trust

account prematurely and without giving proper notice, and failed to

deposit a portion of the retainer in the trust account.

      Although no two cases are identical, we agree with the commission

that Kersenbrock is a relevant precedent. There we imposed a thirty-day
suspension on an attorney who had committed similar trust account

violations   and     made   misrepresentations          on        her   client    security

questionnaire.      Kersenbrock, 821 N.W.2d at 419, 421, 422.                    True, the

trust account violations in Kersenbrock were “systematic” and we

indicated “[t]he cumulative impact of all violations is an important

consideration.”     Id. at 422.    On the other hand, unlike Nelissen, that

attorney had no prior disciplinary history. Id.

      Also of precedential significance is our decision in Eslick. In that

case, we suspended for thirty days the license of an attorney whose trust

account was “out of whack” for months. Eslick, 859 N.W.2d at 203, 204.

Despite the serious nature of the trust account violations, the attorney

had a limited record of prior discipline (consisting of a public reprimand
for something other than trust account violations), she had not made

misrepresentations on her client security reports, and she was receiving

treatment for an illness that had affected her practice. Id. at 202–03.

      Another somewhat analogous precedent is Santiago.5                         See 869
N.W.2d at 181.        That case involved an attorney who violated trust

account rules by not depositing cash retainers in the trust account, not

      5This case was not cited by the commission because it was decided after the

commission filed its report and recommendation.
                                    14

providing notice and accounting, and not reconciling his trust account

regularly. Id. at 179. No client harm was proven, but the attorney had

been notified of deficiencies in a prior audit.          We concluded a

“suspension is warranted given [the attorney]’s postaudit continuing

disregard for the trust account rules scrupulously followed by other Iowa

practitioners.” Id. at 174, 182, 184.

      V. Disposition.
      We suspend Nelissen’s license to practice law with no possibility of

reinstatement for thirty days from the filing of this opinion.         This

suspension shall apply to all facets of the practice of law. See Iowa Ct. R.

35.13(3).   Nelissen must comply with the notification requirements of

Iowa Court Rule 35.23. Costs are assessed against Nelissen pursuant to

Iowa Court Rule 35.27(1). Unless the Board objects, Nelissen shall be

automatically reinstated after the thirty-day suspension period on

condition that all costs have been paid. See id. r. 35.13(2).

      LICENSE SUSPENDED.