Office of Lawyer Regulation v. Lunde

2016 WI 84
SUPREME COURT OF WISCONSIN
CASE NO.: 2015AP2414-D
COMPLETE TITLE: In the Matter of Disciplinary Proceedings
Against Gregory M. Lunde, Attorney at Law:
Office of Lawyer Regulation,
Complainant,
v.
Gregory M. Lunde,
Respondent.
DISCIPLINARY PROCEEDINGS AGAINST LUNDE
OPINION FILED: October 18, 2016
SUBMITTED ON BRIEFS:
ORAL ARGUMENT:
SOURCE OF APPEAL:
COURT:
COUNTY:
JUDGE:
JUSTICES:
CONCURRED:
DISSENTED:
NOT PARTICIPATING:
ATTORNEYS:
2016 WI 84
NOTICE
This opinion is subject to further
editing and modification. The final
version will appear in the bound
volume of the official reports.
No. 2015AP2414-D
STATE OF WISCONSIN : IN SUPREME COURT
In the Matter of Disciplinary Proceedings
Against Gregory M. Lunde, Attorney at Law:
Office of Lawyer Regulation, FILED
Complainant, OCT 18, 2016
v. Diane M. Fremgen
Clerk of Supreme Court
Gregory M. Lunde,
Respondent.
ATTORNEY disciplinary proceeding. Attorney's license
suspended.
¶1 PER CURIAM. We review the report and recommendation
of Referee James G. Curtis approving a stipulation filed by the
Office of Lawyer Regulation (OLR) and Attorney Gregory M. Lunde.
In the stipulation, Attorney Lunde stipulated to the facts
underlying five counts of misconduct alleged in the OLR's
complaint and agreed that the referee could enter conclusions of
law finding that Attorney Lunde violated the various Supreme
Court Rules as set forth in the complaint. The parties jointly
No. 2015AP2414-D
recommended that the appropriate sanction to be imposed is a 60-
day suspension of Attorney Lunde's license to practice law in
Wisconsin. The referee agreed that a 60-day suspension was
appropriate.
¶2 After careful review of the matter, we uphold the
referee's findings of fact and conclusions of law and agree that
a 60-day suspension is an appropriate sanction. We further find
it appropriate to impose the full costs of this proceeding,
which are $1,357.73 as of August 1, 2016, on Attorney Lunde.
¶3 Attorney Lunde was admitted to practice law in
Wisconsin in 1981. He resides in Westby, Wisconsin. Effective
April 12, 2016, Attorney Lunde ceased actively practicing law
due to health reasons. He has no present intention to
recommence the active practice of law.
¶4 Attorney Lunde's prior disciplinary history consists
of a consensual public reprimand imposed by the OLR's
predecessor, the Board of Attorneys Professional Responsibility
(BAPR), for failing to provide competent representation to a
client, failing to act with reasonable diligence and promptness
in representing a client, and failing to cooperate with BAPR's
investigation. Public Reprimand of Gregory M. Lunde, 1992-3,
(electronic copy available at
https://compendium.wicourts.gov/app/raw/000297.html).
¶5 The OLR filed a complaint against Attorney Lunde on
November 25, 2015. Attorney Lunde filed an answer on December
30, 2015. The referee was appointed on March 24, 2016. The
parties' stipulation was filed on July 15, 2016.
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No. 2015AP2414-D
¶6 According to the stipulation, on June 3, 2001, J.S., a
single person and resident of rural Westby, Wisconsin, died
intestate. J.S. was survived by two minor children, D.B., age
14, and Z.S., age 7. On or about June 9, 2001, Attorney Lunde
met with James DelMedico (DelMedico), an officer of a bank,
regarding the need to probate J.S.'s estate.
¶7 On January 30, 2002, Attorney Lunde filed an
Application for Informal Administration of the estate, signed by
DelMedico as the applicant, in Vernon County Circuit Court. The
court issued letters appointing DelMedico personal
representative of the estate on January 30, 2002. DelMedico
contacted Attorney Lunde and requested that he serve as the
attorney for the estate.
¶8 At the time of her death, J.S. was enrolled in a group
life insurance plan sponsored by her employer, with insurance
coverage issued by Metropolitan Life Insurance Company (Met
Life). J.S.'s minor children were entitled to equal shares in
the death benefit payable under the Met Life plan.
¶9 On January 8, 2004, Attorney Lunde filed a petition
and affidavit in the probate matter asking the court to issue an
order directing Met Life to transfer the life insurance proceeds
to his trust account. The circuit court granted the petition on
January 12, 2004 and issued an order directing Met Life to
release the funds to Attorney Lunde's trust account. The
court's order required that the balance of funds received from
Met Life, after payment of any outstanding debts, be retained in
Attorney Lunde's trust account until further order of the court.
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No. 2015AP2414-D
¶10 On November 18, 2004, Attorney Lunde sent a letter to
the court saying that the J.S.'s estate had a credit balance of
$12,668.54 to be divided equally between J.S.'s minor children.
¶11 In 2012, after he was 18 years of age, Z.S. asked his
aunt, S.D., to assist him in obtaining the funds to which he was
entitled from his mother's estate. S.D. subsequently called
Attorney Lunde's office twice during the week of July 23, 2012
and left messages with a secretary. S.D. left a third message
on the office voicemail saying she was planning a trip to
Viroqua on July 30. Attorney Lunde did not return the calls.
¶12 On the morning of July 30, 2012, S.D. spoke with the
Register in Probate for Vernon County about Z.S's funds. While
S.D. was present in the office, the Register in Probate called
Attorney Lunde and told him that S.D. wanted to see him.
Attorney Lunde said he did not have time and asked for S.D.'s
phone number. Despite obtaining the phone number, Attorney
Lunde did not call S.D.
¶13 During August and September 2012, S.D. called Attorney
Lunde's office several more times to inquire about Z.S.'s funds.
Each time Attorney Lunde's secretary either took a message, or
S.D. left a voice mail message. Attorney Lunde never returned
any of the calls.
¶14 On November 29, 2012, the OLR sent Attorney Lunde a
letter informing that a grievance had been filed against him
regarding the money he had received in trust from Met Life in
the J.S. estate matter. After Attorney Lunde failed to respond
to the November 29, 2012, letter the OLR sent two more letters,
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No. 2015AP2414-D
with the final one being personally served upon him by the
Viroqua Police Department. Attorney Lunde failed to respond to
any of the letters.
¶15 On March 5, 2013, this court issued an order to
Attorney Lunde to show cause why his license to practice law
should not be suspended for his willful failure to cooperate
with the OLR's investigation. Attorney Lunde failed to respond
to the court order and on May 13, 2013, this court issued an
order temporarily suspending Attorney Lunde's license to
practice law. The OLR subsequently reported to the court that
Attorney Lunde was cooperating in the investigation of the
grievance, and on June 5, 2013, this court issued an order
reinstating Attorney Lunde's license.
¶16 On July 10, 2013, Attorney Lunde told the OLR he had
been unable to locate his trust account transaction register
regarding the J.S. estate and that he had been unable to access
information related to his trust account. Attorney Lunde also
told the OLR he assumed there were sufficient funds in the
account to release to Z.S. He said he contacted the bank and
was informed his trust account was frozen and that the bank
would not provide him with any other information about the
account.
¶17 On August 12, 2013, the OLR received records from the
Wisconsin Trust Account Foundation, Inc. (WisTAF) in response to
a subpoena. The records revealed that on July 5, 2000, Attorney
Lunde had opened his trust account with Fortress Bank and in
2007 Fortress Bank merged into Lincoln State Bank. In 2008,
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No. 2015AP2414-D
Lincoln State Bank merged into Harris National Association, now
known as BMO Harris Bank, N.A. The earliest records obtained by
the subpoena showed the balance in Attorney Lunde's trust
account was $1,937.30 as of November 12, 2007. The records
showed no activity in the trust account since that date.
¶18 Attorney Lunde has no monthly statements or records
relating to the trust account and cannot explain why the amount
of funds in the account as of November 12, 2007 was less than
the amount of funds belonging to Z.S., which the circuit court's
January 12, 2004 order had required Attorney Lunde hold in trust
until further order of the court. Attorney Lunde asserts that
the trust account balanced and that the funds were in his
account at the time he closed his business in May 2007 to become
the Vernon County Corporation Counsel.
¶19 By a letter to the OLR dated June 6, 2014, Attorney
Lunde confirmed that he had not released to Z.S. the funds that
Attorney Lunde was required to hold in trust pursuant to the
circuit court's January 12, 2004 order. Attorney Lunde stated
he would pay Z.S. the funds to which he was entitled upon
confirmation of Z.S.'s identity.
¶20 Z.S. contacted Attorney Lunde by telephone on December
12, 2014, and on December 19, 2014, Attorney Lunde issued a
check to Z.S. in the amount of $6,334.27, representing one-half
(after expenses), of the funds Attorney Lunde had received from
Met Life. The check was drawn on Attorney Lunde's personal
account at WCCU Credit Union. The check cleared.
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No. 2015AP2414-D
¶21 In the stipulation, the parties agreed that the
referee could enter the following conclusions of law:
[Count 1] By failing to promptly pay Z.S. his portion
of his mother's life insurance, [Attorney] Lunde
violated SCR 20:1.15(d)(1).1
[Count 2] By failing to keep the funds due and owing
to Z.S. in his trust account, [Attorney] Lunde
violated SCR 20:1.15(b)(1).2
[Count 3] By failing to keep the remaining balance of
the insurance proceeds in his trust account pending
1
Effective July 1, 2016, substantial changes were made to
Supreme Court Rule 20:1.15, the "trust account rule." See S.
Ct. Order 14-07, (issued Apr. 4, 2016, eff. July 1, 2016).
Because the conduct underlying this case arose prior to July 1,
2016, unless otherwise indicated, all references to the supreme
court rules will be to those in effect prior to July 1, 2016.
SCR 20:1.15(d)(1) provides:
Upon receiving funds or other property in which a
client has an interest, or in which the lawyer has
received notice that a 3rd party has an interest
identified by a lien, court order, judgment, or
contract, the lawyer shall promptly notify the client
or 3rd party in writing. Except as stated in this rule
or otherwise permitted by law or by agreement with the
client, the lawyer shall promptly deliver to the
client or 3rd party any funds or other property that
the client or 3rd party is entitled to receive.
2
SCR 20:1.15(b)(1) provides:
A lawyer shall hold in trust, separate from the
lawyer's own property, that property of clients and
3rd parties that is in the lawyer's possession in
connection with a representation. All funds of clients
and 3rd parties paid to a lawyer or law firm in
connection with a representation shall be deposited in
one or more identifiable trust accounts.
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No. 2015AP2414-D
further order of the circuit court, [Attorney] Lunde
violated SCR 20:3.4(c).3
[Count 4] By maintaining a trust account balance that
fell below the amount of funds received and to be held
on behalf of Z.S., [Attorney] Lunde converted at least
a portion of E.S.'s money in violation of SCR
20:8.4(c).4
[Count 5] By failing to respond to the OLR's November
29, 2012, January 16, 2013 and February 12, 2013
investigative letters, [Attorney] Lunde violated SCR
22.03(2) and 22.03(6), enforced via SCR 20:8.4(h).5
¶22 As noted above, the parties also agreed that an
appropriate level of discipline for Attorney Lunde's misconduct
was a 60-day suspension of his license to practice law in
Wisconsin. The referee agreed.
¶23 The referee's July 21, 2016 report and recommendation
found that the OLR met its burden of proof with respect to the
five counts of misconduct identified above. The referee noted
that the misconduct in this case arose from Attorney Lunde's
apparent failure to properly close his private law practice in
2007 when he accepted employment as the Vernon County
3
SCR 20:3.4(c) provides: "A lawyer shall not knowingly
disobey an obligation under the rules of a tribunal, except for
an open refusal based on an assertion that no valid obligation
exists."
4
SCR 20:8.4(c) provides: "It is professional misconduct
for a lawyer to engage in conduct involving dishonesty, fraud,
deceit or misrepresentation."
5
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(6), or SCR
22.04(1)."
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No. 2015AP2414-D
Corporation Counsel. The referee noted that the stipulation did
not say that Attorney Lunde failed to make a proper trust
account payment to J.S's older child, D.B., when he turned 18 in
2005. The referee opined that a proper reconciliation of the
trust account at the time Attorney Lunde closed his private law
practice would have avoided the problems that occurred here.
¶24 The referee found that the case presented both
aggravating and mitigating factors. As to aggravating factors,
the referee noted that when Z.S. turned 18 in 2012 and first
made inquiries about the funds, Attorney Lunde's conduct
resulted in a delay of more than two years before the funds were
finally paid to Z.S. In addition, the referee said that
Attorney Lunde's failure to cooperate and respond to the OLR's
various inquiries was flagrant and required unnecessary efforts
on the OLR's part.
¶25 As to mitigating factors, the referee again noted that
the OLR did not contend that Attorney Lunde failed to make a
proper trust account payment to D.B. when he turned 18 in 2005.
The referee said that although the payment to Z.S. was delayed,
Attorney Lunde did make full restitution of the proper amount,
presumably out of his personal funds. The referee noted that
Attorney Lunde ceased the active practice of law due to health
reasons in April 2016 and has no present intention of resuming
the active practice of law. The referee also noted that
although Attorney Lunde did previously receive a consensual
public reprimand, he has not been the subject of further
discipline for more than 20 years.
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No. 2015AP2414-D
¶26 The referee agreed that a 60-day suspension was an
appropriate sanction for Attorney Lunde's misconduct. The
referee noted that a 60-day suspension was ordered by this court
in the recent case of In re Disciplinary Proceedings Against
Bartz, 2015 WI 61, 362 Wis. 2d 752, 864 N.W.2d 881. After
Attorney Bartz settled a personal injury claim, there was an
outstanding chiropractic bill. The settlement statement
required Attorney Bartz to hold funds in trust while he tried to
negotiate a lower payment on the bill. Although an agreement
was promptly reached, Attorney Bartz subsequently disbursed six
trust account checks payable to himself, leaving no funds in
trust attributable to either the chiropractic bill or the
balance owed to the client. This court approved a stipulation
by the parties which called for a 60-day license suspension.
¶27 The referee in this matter opined that Attorney
Bartz's misconduct was much more egregious than the conduct of
Attorney Lunde in that Attorney Bartz intentionally
misappropriated monies held in trust by disbursing checks
payable to himself. The referee said there were no facts of
record establishing that Attorney Lunde intentionally disbursed
trust account checks payable to himself. Rather, based on the
stipulated facts, the referee said Attorney Lunde's misconduct
appeared to involve neglect and sloppiness rather than true
misappropriation. The referee concluded that a 60-day
suspension was warranted.
¶28 This court will adopt a referee's findings of fact
unless they are clearly erroneous. Conclusions of law are
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No. 2015AP2414-D
reviewed de novo. See In re Disciplinary Proceedings Against
Eisenberg, 2004 WI 14, ¶5, 269 Wis. 2d 43, 675 N.W.2d 747. The
court may impose whatever sanction it sees fit, regardless of
the referee's recommendation. See In re Disciplinary
Proceedings Against Widule, 2003 WI 34, ¶44, 261 Wis. 2d 45, 660
N.W.2d 686.
¶29 We adopt the referee's findings of fact and
conclusions of law that Attorney Lunde violated the Supreme
Court Rules as alleged in the five counts set forth above. We
also agree with the referee that a 60-day suspension of Attorney
Lunde's license to practice law in Wisconsin is appropriate. In
addition to the Bartz case, we note that a 60-day suspension was
also imposed in In re Disciplinary Proceedings against Barrock,
2007 WI 24, 299 Wis. 2d 207, 727 N.W.2d 833 (six counts of
misconduct arising out of attorney's failure to hold settlement
funds subject to third-party claim in trust account) and In re
Disciplinary Proceedings Against Riegleman, 2003 WI 3, 259
Wis. 2d 1, 657 N.W.2d 339 (three counts of misconduct arising
out of attorney's failure to notify lienholder of settlement and
unauthorized endorsement of settlement check). We find the
misconduct at issue here to be generally analogous. We also
find it appropriate, as is our usual custom, to impose the full
costs of this disciplinary proceeding on Attorney Lunde.
¶30 IT IS ORDERED that the license of Gregory M. Lunde to
practice law in Wisconsin is suspended for a period of 60 days,
effective the date of this order.
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No. 2015AP2414-D
¶31 IT IS FURTHER ORDERED that within 60 days of the date
of this order, Gregory M. Lunde shall pay to the Office of
Lawyer Regulation the costs of this proceeding, which are
$1,357.73.
¶32 IT IS FURTHER ORDERED that Gregory M. Lunde shall
comply with the provisions of SCR 22.26 concerning the duties of
a person whose license to practice law in Wisconsin has been
suspended.
¶33 IT IS FURTHER ORDERED that compliance with all
conditions of this order is required for reinstatement. See SCR
22.28(2).
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No. 2015AP2414-D
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