In the Matter of the Discipline of Jere B. Reneer ( 2014 )

This opinion is subject to revision before final
publication in the Pacific Reporter
2014 UT 18
IN THE
S UPREME C OURT OF THE S TATE OF U TAH
In the Matter of the Discipline of JERE B. RENEER ,
JERE B. RENEER,
Petitioner,
v.
UTAH STATE BAR ,
Respondent.
No. 20120760
Filed May 23, 2014
Original Proceeding in this Court
Attorneys:
Jere Reneer, Provo, pro se petitioner
Todd Wahlquist, Salt Lake City, for respondent
JUSTICE DURHAM authored the opinion of the Court, in which
CHIEF JUSTICE DURRANT, ASSOCIATE CHIEF JUSTICE NEHRING ,
JUSTICE PARRISH , and JUSTICE LEE joined.
JUSTICE DURHAM , opinion of the Court:
INTRODUCTION
¶1 Attorney Jere Reneer appeals the decision of the Utah
Supreme Court’s Ethics and Discipline Committee (discipline
committee) to privately admonish him for violating rules 1.8(f) and
8.4(a) of the Utah Rules of Professional Conduct. We hold that the
Office of Professional Conduct (OPC) did not produce substantial
evidence that Mr. Reneer violated rule 1.8(f) by failing to obtain the
informed consent of his client to receive compensation from a third
party. Moreover, rule 8.4(a) may not be used as an independent
ground for attorney discipline. We therefore reverse the discipline
committee’s order admonishing Mr. Reneer.
BACKGROUND
¶2 After the police arrested Thomas Broude for criminal
trespass and aggravated assault, Joe Scheeler at the Utah Legal
Group (ULG) contacted Mr. Broude through the mail about legal
representation. Mr. Scheeler is not an attorney, and ULG is not a law
In the matter of the Discipline of JERE B. RENEER
Opinion of the Court
firm, but rather a marketing company that recruits paying clients for
Utah attorneys. Mr. Broude spoke with Mr. Scheeler and then
requested that his mother, Judy Carey, also speak with Mr. Scheeler
because she would be paying for the legal representation. Ms. Carey
met with Mr. Scheeler and signed a contract with ULG. The contract
specified that in exchange for Ms. Carey’s agreement to pay $6,000,
ULG would find and retain an attorney for Mr. Broude. The contract
stated ULG would pay all attorney’s fees, monitor Mr. Broude’s
cases, and resolve disputes between the attorney and the client.
¶3 Ms. Carey incorrectly believed that ULG was a law firm that
would represent her son. Ms. Carey alleged that ULG’s ads
represented that it would “kick ass” and could “get things
accomplished that no other firm could.” Ms. Carey claimed that
Mr. Scheeler told her that without ULG’s help, her son would face
extensive jail time, probation, and fines, but that if she retained ULG,
Mr. Broude would avoid jail. Ms. Carey also alleged that when she
expressed her concern about ULG’s high fee and mentioned the
possibility of a public defender, Mr. Scheeler told her that if she did
not want to see her son go to jail, she should think twice about
getting a public defender.
¶4 After Ms. Carey signed the contract, ULG contacted
Mr. Reneer, and he agreed to represent Mr. Broude for a flat fee of
$2,500. Mr. Reneer was not aware of the amount Ms. Carey agreed
to pay ULG. Neither Ms. Carey nor Mr. Broude ever signed a
separate fee agreement with Mr. Reneer. Mr. Reneer and an associate
at his firm, Reneer & Associates, met with Mr. Broude to discuss his
two cases, requested discovery from the prosecutors, and
represented Mr. Broude at several pretrial hearings. Despite
Mr. Broude’s prior criminal history, Reneer & Associates negotiated
a plea in abeyance for the criminal trespass charge and a plea
agreement on the aggravated assault charge, lowering the charge
from a third-degree felony to a class A misdemeanor. The court
sentenced Mr. Broude to 365 days in jail on the reduced charge, but
suspended all but 120 days of the sentence. Mr. Broude’s jail
sentence was 60 days less than the 180 days recommended by Adult
Probation and Parole in the presentence report.
¶5 Due to Mr. Scheeler’s alleged promise that Mr. Broude
would not receive a jail sentence, Ms. Carey was unhappy with this
result. Ms. Carey wrote a letter to Mr. Scheeler expressing her
discontent and stating her intention to stop making payments
toward the remaining debt she still owed to ULG. Ms. Carey then
submitted a complaint against Mr. Reneer to the Utah State Bar
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Opinion of the Court
Consumer Assistance Program. The complaint incorrectly referred
to Mr. Reneer as an attorney working for the law firm “Utah Legal
Group.” In her complaint, Ms. Carey sought a waiver of the $1,600
she still owed ULG, as well as a $1,000 refund from the money she
had already paid to ULG.
¶6 The OPC investigated Ms. Carey’s complaint and concluded
that Mr. Reneer may have violated (1) rule 1.5(b) of the Utah Rules
of Professional Conduct, which requires that a lawyer communicate
the scope of representation and the basis and rate of fees to the
client; (2) rule 1.8(f), which prohibits a lawyer from accepting
compensation from one other than the client without the client’s
informed consent to do so; (3) rule 5.4(a), which prohibits a lawyer
from sharing legal fees with a nonlawyer; and (4) rule 8.4(a), which
defines professional misconduct for a lawyer. The OPC then referred
the matter to a screening panel of the discipline committee for
further investigation.
¶7 The screening panel held a hearing to investigate the
potential violations identified by the OPC. Ms. Carey, Mr. Reneer,
and an associate at Mr. Reneer’s firm all testified, but Mr. Broude did
not attend the hearing. The screening panel found that Mr. Reneer
violated rules 1.8(f) and 8.4(a) because he failed to obtain informed
consent from Mr. Broude to receive compensation from Ms. Carey
or ULG. The panel determined that Mr. Reneer’s conduct caused
little or no injury and recommended that he be privately
admonished for the violations.
¶8 Mr. Reneer filed an exception to the screening panel’s
recommendation with the discipline committee. Because Mr. Reneer
did not request a new hearing, the discipline committee made its
determination based on the record before the screening panel. The
discipline committee concluded that Mr. Reneer provided competent
representation to his client and that the outcome was reasonable, but
determined that substantial evidence supported the screening
panel’s findings that Mr. Reneer violated rules 1.8(f) and 8.4(a). The
discipline committee issued an order privately admonishing
Mr. Reneer for the violations. Mr. Reneer appealed the discipline
committee’s ruling.
STANDARD OF REVIEW
¶9 In this appeal, we review whether the disciplinary action
taken against Mr. Reneer was supported by substantial evidence. In
proceedings before the screening panel, the OPC bears the burden
of proof to show that discipline is warranted. SUP. CT . R. PROF’L
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PRACTICE 14-517(c). The party filing an exception from the screening
panel’s recommendation to the discipline committee has “the burden
of showing that the determination or recommendation of the
screening panel is unsupported by substantial evidence.” Id.
14-510(d)(3). Finally, the party seeking review of the discipline
committee’s final determination in this court “shall have the burden
of demonstrating that the Committee action was . . . [b]ased on a
determination of fact that is not supported by substantial evidence
when viewed in light of the whole record before the Court.” Id.
14-510(f)(5). Because all of the evidence in this case was presented
before the screening panel, we review the panel’s findings of fact
based on the evidence before it.1
¶10 Under our traditional substantial evidence standard of
review, “[a] decision is supported by substantial evidence if there is
a quantum and quality of relevant evidence that is adequate to
convince a reasonable mind to support a conclusion.” Becker v.
Sunset City, 2013 UT 51, ¶ 10, 309 P.3d 223 (internal quotation marks
omitted). “Substantial evidence is more than a mere scintilla of
evidence and something less than the weight of the evidence.” Id.
¶ 21 (internal quotation marks omitted). “In conducting a substantial
evidence review, we do not reweigh the evidence and independently
choose which inferences we find to be the most reasonable,” but
merely determine if sufficient evidence exists to allow a reasonable
fact-finder to arrive at a particular conclusion. Id. (internal quotation
marks omitted).
¶11 Our review of factual determinations made during attorney
discipline proceedings, however, is less deferential than under our
traditional substantial evidence standard of review. See In re
Discipline of Tanner, 960 P.2d 399, 401 (Utah 1998) (“Review of
attorney discipline proceedings is fundamentally different from
judicial review in other cases.” (internal quotation marks omitted)).
1
When the party filing an exception does not present additional
evidence to the discipline committee, as in this case, the committee
performs a role similar to that of an appellate court, reviewing the
record of the screening panel proceedings to determine whether the
panel’s findings are supported by substantial evidence. SUP. CT . R.
PROF’L PRACTICE 14-510(d)(1), (3). We grant no deference to the
discipline committee’s determination of whether substantial
evidence supports the screening panel’s factual findings because the
discipline committee is in no better position than this court to review
the record of the screening panel proceedings. See State v. Manatau,
2014 UT 7, ¶ 8, 322 P.3d 739.
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Opinion of the Court
Under Article VIII, section 4 of the Utah Constitution, “[t]he
Supreme Court by rule shall govern the practice of law, including . . .
the conduct and discipline of persons admitted to practice law.”
Thus,
in light of our constitutional mandate and the
unique nature of disciplinary actions and our
knowledge of the nature of the practice of law, we
accord less deference to the findings of a lower
tribunal. We reserve the right to draw inferences
from basic facts which may differ from the
inferences drawn by the lower tribunal.
Utah State Bar v. Jardine (In re Discipline of Jardine), 2012 UT 67, ¶ 26,
289 P.3d 516 (internal quotation marks omitted); accord In re
Discipline of Babilis, 951 P.2d 207, 213 (Utah 1997); In re Knowlton, 800
P.2d 806, 808 (Utah 1990). Under this less deferential substantial
evidence standard of review, we still “presume that the [lower
tribunal’s] findings of fact are correct, although we may set those
findings aside if they are not supported by the evidence.” Jardine,
2012 UT 67, ¶ 26 (alteration in original) (internal quotation marks
omitted).
ANALYSIS
I. RULE 1.8(f)
¶12 Rule 1.8(f) of the Utah Rules of Professional Conduct states
that “[a] lawyer shall not accept compensation for representing a
client from one other than the client unless . . . the client gives
informed consent.” The rules define informed consent as “the
agreement by a person to a proposed course of conduct after the
lawyer has communicated adequate information and explanation
about the material risks of and reasonably available alternatives to
the proposed course of conduct.” UTAH R. PROF’L CONDUCT R. 1.0(f).
Informed consent is required when a third party pays a lawyer’s fee
“[b]ecause third-party payers frequently have interests that differ
from those of the client, including interests in minimizing the
amount spent on the representation and in learning how the
representation is progressing.” Id. R. 1.8 cmt. 11. “Sometimes, it will
be sufficient for the lawyer to obtain the client’s informed consent
regarding the fact of the payment and the identity of the third-party
payer.” Id. R. 1.8 cmt. 12. Nevertheless, for consent to be fully
informed, an attorney must “explain the nature and implications of
the conflict in enough detail so that the parties can understand” the
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In the matter of the Discipline of JERE B. RENEER
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conflict being waived. Margulies ex rel. Margulies v. Upchurch, 696
P.2d 1195, 1204 (Utah 1985).
¶13 In this case we review the screening panel’s factual finding
that Mr. Reneer did not obtain his client’s informed consent to
receive compensation from his client’s mother by way of ULG. We
agree that substantial evidence would support a finding that
Mr. Reneer failed to secure his client’s written consent. Mr. Reneer
testified that it was his practice to send a letter to all new clients,
informing them of the importance of attending hearings and
providing all documentation relevant to their case. But the form
letter makes no mention of third-party payments, and Mr. Reneer
admitted that it was possible that he never sent the letter to
Mr. Broude. Mr. Reneer testified that the letter was the only written
communication he exchanged with a new client referred to him by
ULG.
¶14 Written consent, however, is not required to comply with
rule 1.8(f). The rule only requires the client’s “informed consent”; it
does not state that consent must be in writing. The structure of rule
1.8 confirms that a writing is not required. Two of the conflicts
described in rule 1.8 explicitly require a client’s written informed
consent to waive the conflict. UTAH R. PROF’L CONDUCT R. 1.8(a)
(business transactions with a client); id. R. 1.8(g) (aggregate
settlement of the claims of two or more clients). Thus the omission
of a written consent requirement in rule 1.8(f) must be seen as
purposeful, allowing for a client’s oral manifestation of consent.2
¶15 The screening panel received no evidence—much less
substantial evidence—of the absence of Mr. Broude’s oral informed
consent. Testimony about the presence or absence of informed
consent could have been obtained most readily from two sources:
Mr. Broude or Mr. Reneer. But Mr. Broude did not provide any
testimony to the screening panel, and the panel never asked
Mr. Reneer if he obtained Mr. Broude’s informed consent to receive
2
The comments to rule 1.8 recognize one exception. In situations
where third-party payments also constitute a conflict of interest
under rule 1.7, which contains an explicit written consent
requirement, informed consent for the attorney to receive the
payments must be in writing. UTAH R. PROF’L CONDUCT R. 1.8 cmt.
12. Because there was no allegation that the payment of attorney fees
by Ms. Carey or ULG created a rule 1.7 conflict of interest, oral
consent to the fee arrangement would satisfy rule 1.8(f).
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Opinion of the Court
compensation from a third party.3 Mr. Reneer testified that he did
not remember telling his client how much ULG promised to pay him
for the representation, but rule 1.8 does not require an attorney to
disclose the amount of compensation paid to the attorney by a third
party. The comments to rule 1.8 suggest that if a third-party fee
arrangement does not create a rule 1.7 conflict of interest, “informed
consent regarding the fact of the payment and the identity of the
third-party payer” may be sufficient. Id. R. 1.8 cmt. 12.
¶16 The OPC suggests that because Mr. Reneer did not provide
evidence that he obtained his client’s informed consent, the
screening panel’s finding that Mr. Reneer failed to do so should be
upheld. Mr. Reneer, however, did not bear the burden of proving
compliance with the rules of professional conduct. Rather, the OPC
bore the burden of producing evidence showing that Mr. Reneer did
not comply. SUP. CT . R. PROF’L PRACTICE 14-517(c) (“The burden of
proof in proceedings seeking discipline . . . is on the OPC.”). In the
absence of testimony or other evidence on this issue, the screening
panel may not presume noncompliance. Therefore the panel’s
finding of fact that Mr. Reneer failed to obtain his client’s informed
consent, as required by rule 1.8(f), is not supported by substantial
evidence.
II. RULE 8.4(a)
¶17 Mr. Reneer’s alleged violation of rule 8.4(a) of the Utah
Rules of Professional Conduct likewise does not support the order
of admonishment. Rule 8.4(a) provides that “[i]t is professional
misconduct for a lawyer to . . . violate . . . the Rules of Professional
Conduct.” The comments to this rule clarify that “[a] violation of
paragraph (a) based solely on the lawyer’s violation of another Rule
of Professional Conduct shall not be charged as a separate
3
In addition to the absence of any evidence that Mr. Reneer failed
to obtain his client’s informed consent, the screening panel heard
compelling evidence that Mr. Broude impliedly consented to the
third-party payments by referring his mother to ULG, asking her to
pay for his defense, and subsequently accepting Mr. Reneer’s
services. See UTAH R. PROF’L CONDUCT R. 1.0 cmt. 6 (“A lawyer need
not inform a client or other person of facts or implications already
known to the client or other person; nevertheless, a lawyer who does
not personally inform the client or other person assumes the risk that
the client or other person is inadequately informed and the consent
is invalid.”).
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violation.” UTAH R. PROF’L CONDUCT R. 8.4 cmt. 1a.4 Because
Mr. Reneer’s alleged violation of 8.4(a) was based upon the charge
that he violated rule 1.8(f), it may not stand as an independent
ground for discipline.
CONCLUSION
¶18 Substantial evidence does not support a violation of rule
1.8(f). And rule 8.4(a) is not a basis for discipline in this case. We
therefore reverse the order admonishing Mr. Reneer.
____________
4
The discipline committee did not have the benefit of guidance
from comment 1a because it was not added until after the committee
made its final determination in this case. UTAH R. PROF’L CONDUCT
R. 8.4.
8