Knutson, In re

• Decision Date: 01 May 1987
• Docket Number: No. C5-86-1187,C5-86-1187
• Citation: 405 N.W.2d 234
• Parties: In re Petition for Disciplinary Action against Robert O. KNUTSON, an Attorney at Law of the State of Minnesota.
• Court: Minnesota Supreme Court

Page 234

405 N.W.2d 234

In re Petition for Disciplinary Action against Robert O.

KNUTSON, an Attorney at Law of the State of

Minnesota.

No. C5-86-1187.

Supreme Court of Minnesota.

May 1, 1987.

William J. Wernz, Director, Office of Lawyers Prof. Resp., Betty M. Shaw, Asst. Director, St. Paul, for appellant.

Robert O. Knutson, Eden Prairie, Wesley A. Anderson, St. Paul, for respondent.

Heard, considered, and decided by the court en banc.

OPINION

PER CURIAM.

On July 14, 1986, the Director of the Office of Lawyers Professional Responsibility (Director) served a petition for disciplinary action on Robert O. Knutson (Knutson). Knutson's answer, dated August 1, 1986, contained motions to dismiss for lack of probable cause and for lack of jurisdiction. Supreme Court Referee James D. Mason heard Knutson's motions on October 10, 1986, and, on October 15, 1986, held an evidentiary hearing on the petition for disciplinary action.

The referee filed his findings of fact, conclusions of law, and recommendations, dated November 7, 1986. Because neither Knutson nor the Director ordered a transcript, the referee's findings of fact and conclusions of law are conclusive. Minn.R.Law.Prof.Resp. 14(d). The referee recommended that Knutson be publicly reprimanded, pay appropriate costs of this proceeding, be placed on a probationary status until April 16, 1990, on condition that Knutson engage a qualified tax preparer to assist him with his tax returns during the period of probation, and timely file all state and federal returns, and pay all taxes thereon, as they become due, and that, upon request of the Director, he be required to provide the Director with tax authorizations necessary for the Director to obtain verification from state and federal authorities that the requisite tax returns have been filed and the taxes due have been paid in full.

We adopt the referee's recommendation.

Knutson was admitted to the practice of law in the State of Minnesota on October 21, 1966. He has practiced in various locations with various partners and associates, and currently practices in Eden Prairie, Minnesota. During the period 1981 to 1985, Knutson had various family problems, including his father's stroke, lingering illness, and death; his wife's cancer and subsequent surgery; and his daughter's three hospitalizations.

Knutson had sufficient income that he was required by federal law to file federal personal income tax returns for the years 1981, 1982, 1983, and 1984. On or before April 15, 1982, 1983, 1984, and 1985, Knutson filed applications for automatic extension of time to file federal individual income tax returns and paid amounts which he believed were equal to or greater than the amount of federal tax due on his income earned in 1981, 1982, 1983, and 1984.

Under federal law, if Knutson did not obtain further extensions, returns filed after June 15, 1982, August 15, 1983, August 15, 1984, and August 15, 1985, would not be timely filed. Knutson did not obtain further extensions. His 1981 and 1982 federal tax returns were filed in November, 1985, and his 1983 and 1984 federal tax returns were filed in December, 1985. All four returns showed a refund due. The referee found that failure to file timely federal tax returns for 1981, 1982, 1983, and 1984 violated DR 1-102(A)(5) and DR 1-102(A)(6) of the Minnesota Code of Professional Responsibility.

Similarly, Knutson had sufficient income that he was required to file state income tax returns for 1981, 1982, 1983, and 1984. The last dates for timely filing of these returns were April 15, 1982, 1983, 1984, and 1985, respectively. Knutson believed that he had sufficient deductions that no state tax would be due. He did not request extensions and did not file his 1981 and 1982 returns until November, 1985, and his 1983 and 1984 returns until December, 1985. These returns, indeed, showed no tax due. The referee also found that failure to file timely Minnesota income tax returns for 1981, 1982, 1983, and 1984 violated DR 1-102(A)(5) and DR 1-102(A)(6) of the Minnesota Code of Professional Responsibility.

Knutson also failed to pay his attorney registration fees when due. Fees that were due before April 1, 1982, 1983, and 1984 were not paid until January 23, 1985. Failure to pay attorney registration fees results in automatic suspension. Minn.R.Supreme Court Registration Attys. 3. Knutson, however, actively practiced law between April 1, 1982, and January 23, 1985. He changed his office location five times between 1981 and 1986. The referee found that Knutson did not receive actual notice of the registration fees due and that as soon as he was notified of his failure to pay these fees, he paid all accrued registration fees and the penalty charge, and was reinstated. The referee, however, found that Knutson's practice of law while suspended constituted a violation of DR 3-101(B) of the Minnesota Code of Professional Responsibility.

The referee recommended that Knutson's motion to dismiss the petition for lack of probable cause, his motion to dismiss for lack of jurisdiction because his conduct did not constitute violations, and his motion to dismiss for lack of jurisdiction because the charges were brought under the repealed Code of Professional Responsibility all be denied.

Knutson argues before this court, as he did in his motions, that probable cause and jurisdiction are lacking. He also claims that the rules that he is charged with violating are unconstitutional because they are overbroad and void for vagueness. Knutson further claims that the referee's recommended discipline is overly harsh.

Knutson claims that the Director lacks jurisdiction to charge him with violations of the Minnesota Code of Professional Responsibility (MCPR) because it was repealed effective August 31, 1985. He claims that he should have been charged instead under the Minnesota Rules of Professional Conduct (MRPC), which were effective when he was charged.

This court, however, has disciplined attorneys under MCPR for conduct which occurred while MCPR was in effect even though the charges were brought after its repeal. See In re Selb, 395 N.W.2d 81, 82 (Minn.1986) (disciplining attorney under MCPR for conduct before September 1, 1985, and under MRPC for conduct continuing after that date); In re Perry, 393 N.W.2d 371, 371 (Minn.1986) (same); see also In re Jones, 383 N.W.2d 686, 687 (Minn.1986) (disciplining attorney for violations of MCPR on petition served October 28, 1985, after repeal of MCPR).

Knutson also argues that the Director does not have jurisdiction over his conduct regarding his tax returns. He bases this claim on his assertions that "there simply are no tax violations of a type required to support these charges"; that only "intentional failure to file and pay income taxes" is proscribed; and that there must be a conviction or admission of wrongdoing.

Knutson's claim that there are no tax violations of a type required to support charges ignores the referee's findings that Knutson's conduct with respect to both his state and federal taxes violated DR 1-102(A)(5) and DR 1-102(A)(6) of the Minnesota Code of Professional Responsibility. These findings are conclusive because neither Knutson nor the Director ordered a transcript. Minn.R.Law.Prof.Resp. 14(d).

As the referee noted, failure to file income tax returns has been grounds for attorney discipline since at least 1972. In that year we stated:

[W]e hold that the failure to file income tax returns represents a violation of a lawyer's oath of office and further represents a violation of the Code of Professional Responsibility * * *.

* * *

Lawyers in this state should henceforth understand clearly * * * that disciplinary proceedings are mandatory in all cases of failure to file income tax returns.

In re Bunker, 294 Minn. 47, 53-55, 199 N.W.2d 628, 631-32 (1972). Since that time, we have frequently disciplined attorneys for failure to file income tax returns. See, e.g., In re Piper, 387 N.W.2d 882, 882 (Minn.1986); In re Anastas, 368 N.W.2d 271, 271-72 (Minn.1985); In re Fitzgerald, 366 N.W.2d 262, 262 (Minn.1985); In re Larson, 324 N.W.2d 656, 659 (Minn.1982); In re Serstock, 316 N.W.2d 559, 560-61 (Minn.1982).

Knutson also claims that his failure to file was not intentional and was, at most, negligent, and that therefore he is not subject to discipline. The referee, however, found not credible Knutson's claims that he did not know he needed to obtain further extensions if his federal returns were to be timely filed and that he was unaware of a requirement to file a state tax return. We have also stated that:

Any violation of the income tax laws represents a threat to the ability of our governmental units to function, whether such action is done with corrupt intent or not. In the case of a lawyer, it most certainly represents a clear violation of his oath to uphold the Constitution and the laws of the United States and the State of Minnesota.

Bunker, 294 Minn. at 50, 199 N.W.2d at 630 (emphasis added).

Knutson's other claim--that he cannot be disciplined for tax violations when he has not been convicted of and has not admitted to those violations--is also not supported by this court's decisions. The general rule is that an "attorney may be disciplined for actions which are illegal but do not result in a criminal conviction." In re Hanratty, 277 N.W.2d 373, 375 (Minn.1979) (citations omitted). "Whether a respondent has already been convicted or may be convicted of a criminal offense in the future for the same actions is unimportant to a disciplinary proceeding." Id. at 376. The purpose of attorney discipline is not to enforce a criminal code, but is rather to investigate the conduct and fitness of one of the court's officers. Ohio State Bar Ass'n v. Weaver, 41 Ohio St.2d 97, 100, 322 N.E.2d 665, 667 (1975); see also Annotation Effect of Acquittal or Dismissal in Criminal Prosecution as Barring Disciplinary Action Against...