In Re Petition For Disciplinary Action v. Donald W. Fett, No. A09-1862.

CourtSupreme Court of Minnesota (US)
Citation790 N.W.2d 840
Decision Date24 November 2010
PartiesIn re Petition for DISCIPLINARY ACTION AGAINST Donald W. FETT, a Minnesota Attorney, Registration No. 29014.
Docket NumberNo. A09-1862.

790 N.W.2d 840

In re Petition for DISCIPLINARY ACTION AGAINST Donald W. FETT, a Minnesota Attorney, Registration No. 29014.

No. A09-1862.

Supreme Court of Minnesota.

Nov. 24, 2010.


790 N.W.2d 841

COPYRIGHT MATERIAL OMITTED.

790 N.W.2d 842

Syllabus by the Court

1. The referee did not err in finding that the attorney's letter to his client implied that it was the attorney's recommendation as to a course of action, rather than merely confirmation of the facts.

2. Where an attorney advises a client to act contrary to the specific language of a power of attorney without providing the client with information adequate to make an informed decision whether to proceed in accordance with the attorney's advice, it was not clearly erroneous for the referee to conclude that the attorney failed to provide competent representation and failed to adequately communicate with the client.

3. An attorney's disciplinary history and experience in the practice of law are both aggravating factors in determining appropriate discipline.

Martin A. Cole, Director, Timothy M. Burke, Senior Assistant Director, Office of Lawyers Professional Responsibility, St. Paul, MN, for petitioner.

Donald W. Fett, Brooklyn Center, MN, pro se.

OPINION
PER CURIAM.

On September 29, 2009, the Director of the Office of Lawyers Professional Responsibility filed a petition for disciplinary action against Donald Fett, an attorney duly licensed to practice law in Minnesota, alleging that Fett violated Minn. R. Prof. Conduct 1.1 1 and 1.4(b) 2 by advising a client to act in a manner contrary to the express terms of a Minnesota statutory short form power of attorney. After a hearing on the Director's allegations, the referee we appointed found that Fett had committed professional misconduct and recommended that Fett be publicly reprimanded and placed on unsupervised probation for a period of 1 year. Fett contests

790 N.W.2d 843

several of the referee's findings and conclusions of law and the referee's recommended discipline. We conclude that the referee did not err in his findings of fact and conclusions of law, and we publicly reprimand Fett and place him on unsupervised probation for a period of 1 year.

Donald Fett was admitted to practice in the State of Minnesota in 1977 and, since 2002, has practiced exclusively within the areas of estate planning and elder law.

The current disciplinary matter arose from Fett's advice to R.G. On July 9, 2008, R.G. met with Fett to discuss medical assistance planning for his brother, M.G. At the time, M.G. was 88 years old and suffered from dementia, depression, and blindness. M.G. was in a nursing home and was no longer competent to handle his own legal affairs. R.G. explained to Fett that he wanted M.G. to receive the care he needed, while protecting M.G.'s assets for distribution according to M.G.'s wishes, after M.G.'s death.

During the meeting on July 9, Fett learned that M.G. had assets of approximately $607,000, monthly expenses of approximately $6,600, and income from social security of $900 per month. R.G. and a third brother were authorized signatories on M.G.'s checking account. 3 With the exception of the checking account, all of M.G.'s assets were in forms that allowed for transfer at death.

In addition, Fett learned that R.G. was attorney-in-fact for M.G. under a Minnesota statutory short form power of attorney. See Minn.Stat. § 523.23 (2008). By a power of attorney, a principal grants certain powers to an attorney-in-fact. A statutory short form power of attorney lists 13 specific powers, such as the authority to enter into real estate, banking, or gift transactions on the principal's behalf. Id., subd. 1. These powers are denominated (A) through (M) in the first part of the form. Id. Option (N) includes “all of the powers listed in (A) through (M) above and all other matters.” Id. On the statutory short form, M.G. checked option (N), thereby giving R.G. broad authority to act for him. But in the third part of the statutory short form, principals must also state whether they will allow transfer of assets to the attorney-in-fact. Id. On his power of attorney form, M.G. made a check next to the statement “This power of attorney does not authorize the attorney-in-fact to transfer my property to the attorney-in-fact.”

During the July 9 meeting, Fett provided R.G. with a retainer agreement. Several days later, R.G. signed and delivered the retainer agreement and a check for one-half of the retainer fee to Fett's office.

On July 17, 2008, Fett sent a letter to R.G. This letter stated that its purpose was to summarize the July 9 meeting and “to outline and review my recommendations.” In the letter, Fett first summarized M.G.'s financial situation and R.G.'s goal, namely, “to protect some of the remaining inheritance your brother had hoped to leave to you, your siblings and charities.” Fett explained that M.G. could not qualify for medical assistance if his assets totaled more than $3,000. See Minn.Stat. § 256B.056, subd. 3 (2008) (establishing eligibility requirements for medical assistance). Fett advised R.G. to transfer all but about $3,000 of his brother's assets out of the brother's ownership “as soon as possible.” To accomplish this,

790 N.W.2d 844

Fett advised that M.G.'s assets be liquidated and the proceeds deposited into M.G.'s checking account, on which R.G. was an authorized signer. Fett advised that R.G. “then write a check or checks to accomplish the gift in a total amount that will leave about $2800 in your brother's account.”

Once M.G.'s assets had been reduced to $2,800, the July 17 letter advised R.G. to apply for medical assistance for M.G. “to trigger the penalty period.” This is an apparent reference to Minn.Stat. § 256B.0595, subd. 2 (2008). Under section 256B.0595, an individual who makes uncompensated transfers of assets is ineligible for medical assistance for a period of time, the length of which is determined by dividing the uncompensated value of the assets transferred by the average per-person medical assistance rate for nursing facilities in the state in effect on the date of the application for medical assistance. The July 17 letter advised R.G. that if all of M.G.'s assets could be transferred out of M.G.'s name by the end of July, the “penalty period” would begin as of July 1. During the penalty period, Fett advised, R.G. should deposit funds into M.G.'s checking account as needed to pay for his care. Once the penalty period ran, Fett advised, R.G. should reapply for medical assistance for M.G., who “will then qualify for the benefit.”

The letter advised R.G. to ultimately deposit M.G.'s funds into an account in which M.G. himself had no ownership interest, but in which funds would remain available to pay for M.G.'s care until he qualified for medical assistance. Fett acknowledged that the short form power of attorney executed by M.G. “does not allow you to transfer assets to yourself” and described “the ownership and control of the gifted portion” as “problematic.” The July 17, letter nevertheless advised: “From the standpoint of simplicity, it is easiest if you own it, invest it and continue to transfer funds into your brother's account to pay his expenses” and further advised that once M.G. qualified for medical assistance, “[t]he remainder of the gift to you will be yours to keep.” The letter then lists “some problems with this approach,” such as the fact that R.G. would have to pay taxes on income generated by the funds in the account and the possibility that M.G.'s other siblings “may be very suspicious of your ownership.” But the letter does not explain how to reconcile Fett's recommendation that R.G. deposit his brother's assets into an account in R.G.'s name with the provision of the statutory short form power of attorney that barred R.G. from transferring M.G.'s assets to himself.

Fett also advised that because M.G.'s estate was less than $1 million, “there will be no gift or estate tax consequences.” Fett indicated that R.G. would not have to report receipt of M.G.'s funds on R.G.'s income tax returns, but that any income generated by M.G.'s funds would be income to R.G. that would have to be reported on R.G.'s individual income tax returns.

Fett closed his July 17 letter by urging R.G. to keep Fett “up to date as matters progress,” particularly “as you approach the end of the penalty period,” which Fett indicated the parties would be “recalculating ... as circumstances dictate.” Although the letter encouraged R.G. to call Fett with any questions or “to discuss any of these matters further,” the July 17 letter does not indicate that any further meetings between the parties were scheduled.

Fett followed up his July 17 letter with another letter on July 22. With this second letter, Fett enclosed a document titled, “Medical Assistance Action Plan for [M.G.]” In this plan, Fett provided R.G.

790 N.W.2d 845

with 18 steps to follow “as a guide throughout the [medical assistance] process.” Step 1 of the plan was to liquidate all of M.G.'s financial assets and deposit them into M.G.'s checking account. Fett noted that “it would be preferable to simply transfer ownership to the gift recipient(s) where possible,” but noted that “if you are to be the gift recipient, your power of attorney does not allow you to make a transfer directly to yourself.” Step 4 called for M.G. to “make a gift of all but $2,800 from his checking account to gift recipient(s).” Step 9 called for R.G. to “[c]ontinue to pay for [M.G.'s] care as you have been” by withdrawing funds “from the gift account in the amount needed to pay expenses” and depositing them into M.G.'s account, from which M.G.'s expenses would then be paid.

On July 23, Fett had a telephone conversation with R.G. during which, the referee found, Fett encouraged R.G. to liquidate his brother's assets and deposit the proceeds into his brother's checking account to facilitate the anticipated transfers. On July 25, Fett and R.G. were scheduled...

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10 practice notes
  • In re MacDonald, A16-1282
    • United States
    • Supreme Court of Minnesota (US)
    • January 17, 2018
    ...referee's application of law to the facts, including any findings on aggravating and mitigating factors, for clear error. In re Fett , 790 N.W.2d 840, 847 (Minn. 2010).First, the referee found that MacDonald's legal experience was an aggravating factor. She has practiced law since 1987, a c......
  • People v. Al-Haqq, Case Number: 15PDJ046 (consolidated with 15PDJ102)
    • United States
    • Colorado Supreme Court of Colorado
    • October 6, 2016
    ...clear and convincing Respondent's violation of this rule for his failure to maintain complete records of Ward's funds.56 See In re Fett , 790 N.W.2d 840, 848–49 (Minn. 2010) (finding a violation of M.S.A. RPC 1.4(b) where lawyer advised an agent under a power of attorney to transfer the pri......
  • In re Disciplinary Action Against Montez , No. A11–0125.
    • United States
    • Supreme Court of Minnesota (US)
    • February 22, 2012
    ...the cumulative weight of the disciplinary violations; (3) the harm to the public; and (4) the harm to the legal profession. In re Fett, 790 N.W.2d 840, 850 (Minn.2010). Although “prior decisions guide and aid us in enforcing consistent discipline,” Rebeau, 787 N.W.2d at 174, we ultimately d......
  • In re Disciplinary Action Against Sea, A17-1548
    • United States
    • Supreme Court of Minnesota (US)
    • August 7, 2019
    ...case specific analysis—because "substantial experience as a lawyer may constitute an aggravating factor," citing Overboe ); In re Fett , 790 N.W.2d 840, 851–52 (Minn. 2010) (stating that "[s]ubstantial practice in the law is also an aggravating factor because it is assumed that an experienc......
  • Request a trial to view additional results
10 cases
  • In re MacDonald, A16-1282
    • United States
    • Supreme Court of Minnesota (US)
    • January 17, 2018
    ...referee's application of law to the facts, including any findings on aggravating and mitigating factors, for clear error. In re Fett , 790 N.W.2d 840, 847 (Minn. 2010).First, the referee found that MacDonald's legal experience was an aggravating factor. She has practiced law since 1987, a c......
  • People v. Al-Haqq, Case Number: 15PDJ046 (consolidated with 15PDJ102)
    • United States
    • Colorado Supreme Court of Colorado
    • October 6, 2016
    ...clear and convincing Respondent's violation of this rule for his failure to maintain complete records of Ward's funds.56 See In re Fett , 790 N.W.2d 840, 848–49 (Minn. 2010) (finding a violation of M.S.A. RPC 1.4(b) where lawyer advised an agent under a power of attorney to transfer the pri......
  • In re Disciplinary Action Against Montez , No. A11–0125.
    • United States
    • Supreme Court of Minnesota (US)
    • February 22, 2012
    ...the cumulative weight of the disciplinary violations; (3) the harm to the public; and (4) the harm to the legal profession. In re Fett, 790 N.W.2d 840, 850 (Minn.2010). Although “prior decisions guide and aid us in enforcing consistent discipline,” Rebeau, 787 N.W.2d at 174, we ultimately d......
  • In re Disciplinary Action Against Sea, A17-1548
    • United States
    • Supreme Court of Minnesota (US)
    • August 7, 2019
    ...case specific analysis—because "substantial experience as a lawyer may constitute an aggravating factor," citing Overboe ); In re Fett , 790 N.W.2d 840, 851–52 (Minn. 2010) (stating that "[s]ubstantial practice in the law is also an aggravating factor because it is assumed that an experienc......
  • Request a trial to view additional results

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