Claggett, Matter of

• Decision Date: 06 March 1996
• Docket Number: No. 18894,18894
• Citation: 1996 SD 21,544 N.W.2d 878
• Parties: In the Matter of The Discipline of David L. CLAGGETT, as an Attorney At Law.
• Court: South Dakota Supreme Court

Page 878

544 N.W.2d 878

1996 SD 21

In the Matter of The Discipline of David L. CLAGGETT, as an Attorney At Law.

No. 18894.

Supreme Court of South Dakota.

Argued Sept. 12, 1995.

Reassigned Feb. 8, 1996.

Decided March 6, 1996.

Laurence J. Zastrow, Pierre, for Disciplinary Board.

Rick A. Cain, Mobridge, for respondent Claggett.

MILLER, Chief Justice (on reassignment).

¶1 The South Dakota State Bar initiated formal attorney disciplinary proceedings resulting in a recommendation from the Disciplinary Board for a public censure. After a hearing, the Referee (Circuit Judge Jack Von Wald) recommended a private reprimand. Although we adopt his findings, we respectfully reject the Referee's recommendation and determine the appropriate disciplinary action to be public censure.

FACTS

¶2 David L. Claggett graduated from the University of South Dakota Law School in 1981 and was admitted to the practice of law in this state on January 4, 1982. He commenced practice as an associate with a law firm in Brookings. Subsequently, he moved to Spearfish, where he is presently practicing law as a sole practitioner.

¶3 Claggett's mother-in-law, Virginia Foster, was injured in a serious bike accident on July 5, 1988, and it became necessary for a guardian to be appointed to handle her affairs. Claggett's wife, JoAnn, petitioned and was appointed guardian of Virginia Foster on August 12, 1988. JoAnn posted a $100,000.00 guardian's bond purchased from Western Surety Company. Claggett at all material times acted as guardianship attorney.

¶4 The family of Virginia Foster agreed any family member could borrow money from the guardianship estate. ¹ Repayment of any loans was to be evidenced by written promissory notes. No accounting was filed for the guardianship in 1989. An accounting was filed on July 30, 1990, but it did not set forth the beginning balance, receipts, expenditures, or investments chronologically, or an ending balance. The accounting did not show loans made to Claggett ² and JoAnn. ³

¶5 Claggett asserts his employees typed the 1990 accounting and he merely failed to review the accounting before it was filed. ⁴ No subsequent accountings were filed by the guardianship for the years 1991, 1992, and part of 1993, prior to Virginia Foster's death.

¶6 Claggett had executed promissory notes for his loans and repaid them with interest before Virginia Foster's death. Claggett did not withdraw as attorney from the guardianship, file a closing inventory upon the death of Virginia Foster, nor did he notify the Court within a reasonable time after he discovered JoAnn's loans exceeded her capacity to repay them.

¶7 Neither Claggett nor his law firm received any benefits from JoAnn's loans to herself. ⁵ Claggett and JoAnn maintained their finances separately. She used the loans for clothing, cash advances, and other personal expenses. She has since received counseling for compulsive spending. Claggett acknowledged at the hearing he did not act competently in representing the guardianship estate.

¶8 With this background, we turn now to a determination of an appropriate discipline.

DECISION

¶9 The Disciplinary Board and the Referee conducted hearings and made findings, conclusions, and recommendations that Claggett's conduct should be disciplined. We give careful consideration to their findings as they have had the advantage of seeing and hearing the witnesses. In re Discipline of Jeffries, 500 N.W.2d 220, 225 (S.D.1993). However, we give no particular deference to a Referee's recommended sanction. In re Discipline of Dana, 415 N.W.2d 818, 822 (S.D.1987). Therefore, although we may adopt the findings of a referee, it does not necessarily follow that we will also adopt the recommendations. Dana, 415 N.W.2d at 822 (citing In re Discipline of Rensch, 333 N.W.2d 713, 714 (S.D.1983)). "The ultimate decision for discipline of members of the State Bar rests with this Court." Jeffries, 500 N.W.2d at 225 (quoting In re Discipline of Stanton, 446 N.W.2d 33, 42 (S.D.1989); Dana, 415 N.W.2d at 822).

¶10 Members of the South Dakota Bar are governed by the South Dakota Rules of Professional Conduct. SDCL ch. 16-18 App. The Disciplinary Board contends Claggett violated the South Dakota Rules of Professional Conduct, specifically Rules 1.1 and 1.3, ⁶ in handling the Guardianship of Virginia Foster.

¶11 Claggett has stipulated to his failure to exercise reasonable diligence and promptness in monitoring the guardianship estate and in his representation as the attorney for the guardian of Virginia Foster. As we have often stated, disciplinary proceedings are not conducted to punish an attorney. Jeffries, 500 N.W.2d at 222; In re Discipline of Simpson, 467 N.W.2d 921, 922 (S.D.1991); In re Discipline of Hendrickson, 456 N.W.2d 140, 141 (S.D.1990); In re Discipline of Walker, 254 N.W.2d 452, 455 (S.D.1977). Rather, the purpose of a disciplinary proceeding is to protect the public from further attorney misconduct. Jeffries, 500 N.W.2d at 222; In re Discipline of Kirby, 336 N.W.2d 378, 380 (S.D.1983).

¶12 In determining the appropriate sanction, we must review the totality of the attorney/client relationship to determine if any mitigating factors warrant consideration. Matter of Discipline of Bihlmeyer, 515 N.W.2d 236, 239 (S.D.1994).

¶13 While Claggett's conduct is in no way condoned by this Court, there are a number of mitigating factors which suggest the public will be protected from future wrongdoing: (1) he has no pattern of misconduct and no prior incidents of alleged misconduct; (2) he intends to refrain from handling guardianships in the future; (3) he changed his office practice to more closely monitor similar problems in the future; (4) the misconduct arose out of a unique family relationship, hopefully reducing the likelihood of a repeat occurrence; (5) Claggett notified the bonding company regarding JoAnn's misconduct and cooperated with them in reaching a settlement, including a personal guarantee of the settlement amount; (6) he has acknowledged his misconduct and appears repentant; (7) he has now obtained legal malpractice insurance to protect his clients; and (8) he fully cooperated with the Disciplinary Board and Referee during the investigation of the proceedings.

¶14 We have considered several factors in deciding appropriate discipline, including: "whether the conduct involved dishonesty, deceit, fraud, or misrepresentation; whether the conduct is prejudicial to the administration of justice; whether the conduct adversely reflects upon the attorney's integrity, competency or fitness to practice law; the seriousness of the misconduct by the attorney; and the likelihood of repeated instances of similar misconduct." Jeffries, 500 N.W.2d at 223 (citations omitted).

¶15 Claggett's conduct was foolish and negligent but not fraudulent or dishonest. While his failure to ensure the proper accounting of the guardianship was prejudicial to the administration of justice, his subsequent conduct of cooperating with the bonding company and negotiating a settlement reflects an effort to remedy the situation. Additionally, his competency to practice law is bolstered by his otherwise clean disciplinary record and his change of office practices.

¶16 Furthermore, while not dispositive of the case before us, we may look to the ABA Standards for Imposing Lawyer Sanctions for some guidance. ⁷ "After misconduct has been established, aggravating and mitigating circumstances may be considered in deciding what sanction to impose." ABA Standards Rule 9.1. Aggravating factors, suggested by the guidelines, include (a) prior disciplinary offenses, (b) dishonest or selfish motive, (c) a pattern of misconduct, (d) multiple offenses, (e) bad faith obstruction of the disciplinary proceeding by intentionally failing to comply with rules or orders of the disciplinary agency, (f) submission of false evidence, false statements, or other deceptive practices during the disciplinary process, (g) refusal to acknowledge wrongful nature of conduct, (h) vulnerability of victim, (i) substantial experience in the practice of law, and (j) indifference to making restitution. ABA Standards Rule 9.22. Mitigating factors include (a) absence of a prior disciplinary record, (b) absence of a dishonest or selfish motive, (c) personal or emotional problems, (d) timely good faith effort to make restitution or to rectify consequences of misconduct, (e) full and free disclosure to Disciplinary Board or cooperative attitude toward proceedings, (f) inexperience in the practice of law, (g) character or reputation, (h) physical or mental disability or impairment, (i) delay in disciplinary proceedings, (j) interim rehabilitation, (k) imposition of other penalties or sanctions, (l ) remorse, and (m) remoteness of prior offenses. ABA Standards Rule 9.32.

¶17 Considering all of the applicable factors, we conclude that a severe sanction is not appropriate in this matter. Rather, we agree with the Board's recommendation that public censure is the appropriate discipline to be imposed upon Claggett. We also note that although he deserves this censure, we believe him a fit and proper person to practice law. ⁸

¶18 Therefore, pursuant to SDCL 16-19-35(4), a judgment of public censure will be entered. Additionally, Claggett is to be taxed with all necessary costs incurred in this matter by the Unified Judicial System and the Disciplinary Board of the State Bar. Lastly, on an annual basis, Claggett is required to provide to the Disciplinary Board proof of legal malpractice insurance or other appropriate security to protect his clients.

¶19 SABERS, AMUNDSON, and GILBERTSON, JJ., concur.

¶20 KONENKAMP, J., deeming himself disqualified, did not participate in...