In re Mason - ( , 427 P.3d 40 ( 2018 )

IN THE SUPREME COURT OF THE STATE OF KANSAS
No. 119,012
In the Matter of JEFFERY A. MASON,
Respondent.
ORIGINAL PROCEEDING IN DISCIPLINE
Original proceeding in discipline. Opinion filed September 28, 2018. Indefinite Suspension.
Stanton A. Hazlett, Disciplinary Administrator, argued the cause, and was on the formal complaint for the
petitioner.
John J. Ambrosio, of Ambrosio & Ambrosio, Chtd., of Topeka, argued the cause, and Jeffery A.
Mason, respondent, argued the cause pro se.
PER CURIAM: This is an attorney discipline proceeding against Jeffery A. Mason,
of Goodland, Kansas. Respondent was admitted to the practice of law in the state of
Kansas on September 23, 1983.
On December 23, 2016, the Kansas Supreme Court suspended respondent's license
to practice law for a period of six months for violating Kansas Rules of Professional
Conduct (KRPC) 1.1 (2015 Kan. Ct. R. Annot. 442) (competence), 1.3 (2015 Kan. Ct. R.
Annot. 461) (diligence), 1.4 (2015 Kan. Ct. R. Annot. 482) (communication), 8.4(c)
(2015 Kan. Ct. R. Annot. 672) (engaging in conduct involving dishonesty, fraud, deceit,
or misrepresentation), and 8.4(d) (engaging in conduct prejudicial to the administration of
justice). In re Mason, 305 Kan. 662, 385 P.3d 523 (2016). The respondent's license
remains suspended.
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On December 19, 2017, the Disciplinary Administrator's office filed a new formal
complaint against respondent alleging violations of the Kansas Rules of Professional
Conduct. Respondent filed an answer to the formal complaint.
A panel of the Kansas Board for Discipline of Attorneys held a hearing on
February 13, 2018. Respondent appeared in person and with counsel, John J. Ambrosio.
The hearing panel determined respondent violated KRPC 1.3 (2018 Kan. S. Ct. R. 292)
(diligence); KRPC 1.4(a) (2018 Kan. S. Ct. R. 293) (client communication); and KRPC
8.4(c) (2018 Kan. S. Ct. R. 381) (conduct involving dishonesty, fraud, deceit, or
misrepresentation).
Upon conclusion of the hearing, the panel made findings of fact, conclusions of
law, and a disciplinary recommendation. Respondent took no exceptions to the hearing
panel's report but reserved the right to argue about the appropriate discipline.
Before this court, the Disciplinary Administrator's office endorses the panel's
findings and recommends the respondent's license to practice law be indefinitely
suspended with an effective date made retroactive to December 23, 2016, the date of the
six-month suspension previously entered by this court. Respondent recommends he be
censured, that the censure be published in the Kansas Reports, and that he be placed on
probation under the terms and conditions in his proposed probation plan. We quote the
report's pertinent parts below.
"Findings of Fact
....
"7. In March, 1988, the board of directors of Northwest Kansas Area
Medical Foundation (hereinafter "the Foundation") retained the respondent to prepare an
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annual report for the corporation and to annually prepare and file IRS Form 990EZ. The
Foundation is a nonprofit organization, formed under Internal Revenue Code 501(c)(3).
IRS Form 990EZ is required to be filed annually with the IRS by nonprofit organizations
to be exempt from income tax. Later that year, the respondent became a member of the
Foundation's board of directors.
"8. In 2001, the respondent failed to timely file the IRS Form 990EZ and a
penalty was imposed by the IRS.
"9. In 2003, the respondent became the president of the Foundation.
"10. The respondent timely filed IRS Forms 990EZ for tax years 2004
through 2009. Additionally, the respondent timely prepared the annual reports during
those same years for the Foundation. Finally, the respondent satisfactorily performed
other legal services to the Foundation during this time.
"11. However, the respondent failed to file IRS Form 990EZ for the
Foundation for tax years 2010 through 2015. Despite the respondent's failure to file IRS
Form 990EZ for the Foundation for tax years 2010 through 2015, the respondent did
timely prepare the annual reports for the Foundation for those same years.
"12. In 2013, the Foundation changed its name to the Goodland Medical
Foundation. The respondent drafted the documents for the name change, including the
amendments to the Articles of Incorporation. The respondent properly filed the
amendments to the Articles of Incorporation with the Kansas Secretary of State.
"13. When questioned by board members regarding the status of the IRS
Forms 990EZ, the respondent falsely reported that the forms were taken care of or that he
was working on them.
"14. On July 5, 2016, the Foundation learned that its Internal Revenue Code
501(c)(3) status had been revoked as a result of the respondent's failure to file IRS Forms
990EZ beginning in 2011. Even after the Foundation's board learned that its Internal
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Revenue Code 501(c)(3) status had been revoked, the respondent continued to falsely
report that he was working on taking care of the situation when he was taking no action.
"15. On January 5, 2017, the respondent advised the board of the Foundation
that he was not seeking re-election as president of the board. By that time, the
respondent's license to practice law had been suspended by the Kansas Supreme Court for
other misconduct.
"16. On January 12, 2017, the respondent met with R.S., a board member
regarding the IRS Forms 990EZ. R.S. requested a copy of the forms. The respondent told
her that he would get them to her and he would call the IRS to check on the status. The
respondent, however, did not tell R.S. that he had not filed them. The respondent took no
action to resolve the situation.
"17. On January 30, 2017, the respondent submitted his resignation as
president and [as] a board member of the Foundation. On February 23, 2017, the
respondent turned over his files to the Foundation's secretary. Despite the respondent's
familiarity with the disciplinary process, the respondent failed to self-report his
misconduct.
"18. The Foundation retained Kenneth Wasserman to seek reinstatement of
the Foundation's Internal Revenue Code 501(c)(3) status. On March 6, 2017, Kenneth
Wasserman filed a complaint with the disciplinary administrator's office. The
respondent's actions resulted in a financial loss to the Foundation in the amount of at least
$45,500. Additionally, the Foundation incurred attorney fees in the amount of $2,244.76,
accounting fees in the amount of $3,500, and a reinstatement fee of $850. Finally,
persons who made charitable donations to the Foundation while the Foundation's Internal
Revenue Code 501(c)(3) status was lost have been notified that their donations may not
be tax deductible.
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"Conclusions of Law
"19. Based upon the respondent's answer to the formal complaint and the
above findings of fact, the hearing panel concludes as a matter of law that the respondent
violated [KRPC] 1.3, [KRPC] 1.4, and [KRPC] 8.4, as detailed below.
"[KRPC] 1.3
"20. Attorneys must act with reasonable diligence and promptness in
representing their clients. See [KRPC] 1.3. The respondent admitted that he failed to
diligently and promptly represent the Foundation by failing to file the IRS Form 990EZ
for tax years 2010 through 2015. The respondent's lack of diligence caused the
Foundation to [lose] at least $45,500. Because the respondent failed to act with
reasonable diligence and promptness in representing his client, the hearing panel
concludes that the respondent violated [KRPC] 1.3.
"[KRPC] 1.4
"21. [KRPC] 1.4(a) provides that '[a] lawyer shall keep a client reasonably
informed about the status of a matter and promptly comply with reasonable requests for
information.' Id. In this case, the respondent admitted that he violated [KRPC] 1.4(a)
when he misled the Foundation's board of directors regarding the status of the IRS Form
990EZ for tax years 2010 through 2015. Accordingly, the hearing panel concludes that
the respondent violated [KRPC] 1.4(a).
"[KRPC] 8.4(c)
"22. 'It is professional misconduct for a lawyer to . . . engage in conduct
involving dishonesty, fraud, deceit or misrepresentation.' [KRPC] 8.4(c). The respondent
engaged in conduct that involved dishonesty when he misled members of the
Foundation's board that he was working on or had taken care of the IRS Form 990EZ for
tax years 2010 through 2015. As such, the hearing panel concludes that the respondent
violated [KRPC] 8.4(c).
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"American Bar Association
Standards for Imposing Lawyer Sanctions
"23. In making this recommendation for discipline, the hearing panel
considered the factors outlined by the American Bar Association in its Standards for
Imposing Lawyer Sanctions (hereinafter 'Standards'). Pursuant to Standard 3, the factors
to be considered are the duty violated, the lawyer's mental state, the potential or actual
injury caused by the lawyer's misconduct, and the existence of aggravating or mitigating
factors.
"24. Duty Violated. The respondent violated his duty to his client to provide
diligent representation and adequate communication. Additionally, the respondent
violated his duty to the public to maintain his personal integrity.
"25. Mental State. The respondent knowingly violated his duties.
"26. Injury. As a result of the respondent's misconduct, the respondent caused
the Foundation a financial loss of at least $45,500. Additionally, the respondent's
misconduct created a potential injury to persons who made donations to the Foundation.
"27. Aggravating and Mitigating Factors. Aggravating circumstances are any
considerations or factors that may justify an increase in the degree of discipline to be
imposed. In reaching its recommendation for discipline, the hearing panel, in this case,
found the following aggravating factors present:
a. Prior Disciplinary Offenses. On December 23, 2016, the
Kansas Supreme Court suspended the respondent's license to practice
law for violation [of] [KRPC] 1.1 (competence), [KRPC] 1.3 (diligence),
[KRPC] 1.4 (communication), [KRPC] 8.4(c) (engaging in conduct
involving dishonesty, fraud, deceit, or misrepresentation), and [KRPC]
8.4(d) (engaging in conduct prejudicial to the administration of justice).
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Recently, the disciplinary administrator informally admonished the
respondent for violating [KRPC] 1.1 (competence) in a water rights case.
b. Dishonest or Selfish Motive. The respondent repeatedly provided
false information to members of the Foundation's board. Thus, the hearing panel
concludes that the respondent's misconduct was motivated by dishonesty. The
respondent's misconduct, however, was not selfish. The respondent did not gain
from the misconduct.
c. A Pattern of Misconduct. For a period of years, the respondent
failed to file IRS Form 990EZ on behalf of the Foundation. Additionally, for a
period of years, the respondent falsely told members of the Foundation's board
that the IRS Form 990EZ were taken care of. Additionally, the misconduct in this
case is remarkably similar to the misconduct in the previous disciplinary case in
that in both cases the respondent engaged in dishonest conduct to conceal facts
which he did not want others to discover. The hearing panel concludes that the
respondent's actions establish a pattern of misconduct.
d. Multiple Offenses. The respondent committed multiple rule
violations. The respondent violated [KRPC] Rules 1.3 (diligence), 1.4
(communication), and 8.4(c) (engaging in conduct involving dishonesty, fraud,
deceit, or misrepresentation). Accordingly, the hearing panel concludes that the
respondent committed multiple offenses.
e. Substantial Experience in the Practice of Law. The Kansas
Supreme Court admitted the respondent to practice law in the State of Kansas in
1983. At the time of the misconduct, the respondent has been practicing law for
nearly 30 years.
f. Indifference to Making Restitution. While the respondent has
malpractice insurance and while the respondent has turned over this matter to the
carrier, at this time the Foundation remains financially injured by the
respondent's misconduct. At the hearing on this matter, the respondent did not
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express any concern about the fact that the Foundation has not yet been made
whole or what he will do if his carrier does not make the Foundation whole.
"28. Mitigating circumstances are any considerations or factors that may
justify a reduction in the degree of discipline to be imposed. In reaching its
recommendation for discipline, the hearing panel, in this case, found the following
mitigating circumstances present:
a. Personal or Emotional Problems if Such Misfortunes Have
Contributed to Violation of the Kansas Rules of Professional Conduct. The
respondent suffers from anxiety, depression, and concomitant narcissism. It is
clear that the respondent's mental health struggles contributed to his misconduct.
The respondent has worked hard on his issues, as detailed by his psychologist,
Dr. Karen L. Higginbotham during her testimony and documented in her
treatment summaries provided.
b. The Present and Past Attitude of the Attorney as Shown by His
or Her Cooperation During the Hearing and His or Her Full and Free
Acknowledgment of the Transgressions. The respondent fully cooperated with
the disciplinary process. Additionally, the respondent admitted the facts and the
rule violations.
c. Previous Good Character and Reputation in the Community
Including Any Letters from Clients, Friends and Lawyers in Support of the
Character and General Reputation of the Attorney. The respondent was an active
and productive member of the bar of Goodland, Kansas. The respondent enjoys
the respect of his peers and generally possesses a good character and reputation
as evidenced by several letters received by the hearing panel.
d. Remorse. At the hearing on this matter, the respondent expressed
genuine remorse for having engaged in the misconduct.
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"29. In addition to the above-cited factors, the hearing panel has thoroughly
examined and considered the following Standards:
'4.41 Disbarment is generally appropriate when:
....
(b) a lawyer knowingly fails to perform services for a client
and causes serious or potentially serious injury to a
client; or
(c) a lawyer engages in a pattern of neglect with respect to
client matters and causes serious or potentially serious
injury to a client.
'4.42 Suspension is generally appropriate when:
(a) a lawyer knowingly fails to perform services for a client
and causes injury or potential injury to a client; or
(b) a lawyer engages in a pattern of neglect and causes
injury or potential injury to a client.
'4.62 Suspension is generally appropriate when a lawyer knowingly
deceives a client, and causes injury or potential injury to the client.
'5.11 Disbarment is generally appropriate when:
....
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(b) a lawyer engages in any other intentional conduct
involving dishonesty, fraud, deceit, or misrepresentation
that serious[ly] adversely reflects on the lawyer's fitness
to practice.
'8.1 Disbarment is generally appropriate when a lawyer:
....
(b) has been suspended for the same or similar misconduct,
and intentionally or knowingly engages in further acts of
misconduct that cause injury or potential injury to a
client, the public, the legal system, or the profession.'
"Recommendation
"30. During closing arguments, the disciplinary administrator indicated that
had he known about the misconduct in this case at the time of the previous case, he would
have recommended an indefinite suspension at that time. As a result, the disciplinary
administrator recommended that the respondent's license be indefinitely suspended and
that the effective date of the indefinite suspension be made retroactive to December 23,
2016, the date of the six month suspension previously entered by the Court. The
disciplinary administrator also argued that if the hearing panel was inclined to
recommend a shorter suspension, the disciplinary administrator recommended that
regardless, a reinstatement hearing, under Rule 219 be recommended to ensure that the
respondent is fit to practice at the time of his reinstatement.
"31. The respondent recommended that he be censured, that the censure be
published in the Kansas Reports, and that the respondent be placed on probation under
the terms and conditions in his proposed probation plan. Alternatively, the respondent
recommended that his license be suspended for a period of time, but that the imposition
of the suspension be suspended [and] that he be placed on probation under the terms and
conditions of his proposed probation plan. Additionally, the respondent indicated a
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willingness to remain on probation for a period longer than three years. Finally, the
respondent indicated that he will not file a petition seeking reinstatement to the practice
of law from the previous suspension until after the Court issues its opinion in this case.
"32. When a respondent makes a request to be placed on probation, the
hearing panel is obligated to consider Rule 211(g) to determine whether consideration of
probation is appropriate.
'(3) The Hearing Panel shall not recommend that the Respondent be
placed on probation unless:
(i) the Respondent develops a workable, substantial, and
detailed plan of probation and provides a copy of the
proposed plan of probation to the Disciplinary
Administrator and each member of the Hearing Panel at
least fourteen days prior to the hearing on the Formal
Complaint;
(ii) the Respondent puts the proposed plan of probation into
effect prior to the hearing on the Formal Complaint by
complying with each of the terms and conditions of the
probation plan;
(iii) the misconduct can be corrected by probation; and
(iv) placing the Respondent on probation is in the best interests
of the legal profession and the citizens of the State of
Kansas.'
"33. The hearing panel concludes that the respondent developed a workable,
substantial, and detailed plan of probation. The respondent provided a copy of the
proposed plan of probation to the disciplinary administrator and each member of the
hearing panel approximately a month before the hearing on the formal complaint. The
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respondent put [all of] the elements of the proposed plan of probation into effect that he
could prior to the hearing, given that his license to practice law is currently suspended.
However, the misconduct cannot be corrected by probation. See In re Stockwell, 296
Kan. 860, 868, 295 P.3d 572 (2013) ('Moreover, this court is generally reluctant to grant
probation where the misconduct involves fraud or dishonesty because supervision, even
the most diligent, often cannot effectively guard against dishonest acts.') Additionally,
placing the respondent on probation is not in the best interests of the legal profession and
the citizens of the State of Kansas. Accordingly, the hearing panel concludes that
probation is not appropriate in this case at this time.
"34. The respondent's misconduct in this case and in the 2016 disciplinary
case is serious misconduct. The respondent repeatedly engaged in dishonest conduct. In
the 2016 disciplinary case, when the respondent could not accomplish his client's goals,
the respondent fabricated pleadings to deceive his client. In this case, the respondent's
inaction cost his client at least $45,[5]00 and the respondent compounded his misconduct
by providing false information to his client.
"35. Particularly concerning to the hearing panel is the fact that the
respondent knew that he had engaged in the conduct at issue in this case at the time of the
earlier hearing, but affirmatively stated during that hearing that there were no additional
issues in his practice. Before the respondent is permitted to resume the practice of law,
the hearing panel must have confidence that the respondent's misconduct will not recur.
At this time, the hearing panel does not have confidence that there are no other issues or
that the respondent will not repeat the misconduct.
"36. Accordingly, based on the findings of fact, conclusions of law, and the
Standards listed above, the hearing panel unanimously recommends that the respondent's
license to practice law be indefinitely suspended. The hearing panel further recommends
that the effective date of the indefinite suspension be made retroactive to December 23,
2016, the date of the Court's previous suspension order. The hearing panel recommends
that the indefinite suspension be made retroactive provided the respondent does not file a
motion for reinstatement from his earlier suspension prior to the Court taking action in
this case.
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"37. At the reinstatement hearing, the hearing panel recommends that the
respondent put forth a plan of practice supervision to include safeguards to hold the
respondent accountable and to prevent the recurrence of the misconduct in this case. In
addition to supervision, the plan should also include participation in KALAP through an
extended monitoring agreement and continued treatment, should the treatment provider
determine that ongoing treatment would be beneficial to the respondent.
"38. Costs are assessed against the respondent in an amount to be certified by
the Office of the Disciplinary Administrator."
DISCUSSION
In a disciplinary proceeding, this court considers the evidence, the panel's findings,
and the parties' arguments and determines whether KRPC violations exist and, if they do,
what discipline should be imposed. Attorney misconduct must be established by clear and
convincing evidence. In re Foster, 292 Kan. 940, 945, 258 P.3d 375 (2011); see also
Supreme Court Rule 211(f) (2018 Kan. S. Ct. R. 251) (a misconduct finding must be
established by clear and convincing evidence). "Clear and convincing evidence is
'evidence that causes the factfinder to believe that "the truth of the facts asserted is highly
probable."'" In re Lober, 288 Kan. 498, 505, 204 P.3d 610 (2009) (quoting In re Dennis,
286 Kan. 708, 725, 188 P.3d 1 [2008]).
Respondent filed no exceptions to the final hearing report. As such, the panel's
factual findings are deemed admitted. Supreme Court Rule 212(c), (d) (2018 Kan. S. Ct.
R. 255).
The evidence before the hearing panel establishes by clear and convincing
evidence the charged conduct violated KRPC 1.3 (diligence); KRPC 1.4(a) (client
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communication); and KRPC 8.4(c) (conduct involving dishonesty, fraud, deceit, or
misrepresentation). We adopt the panel's findings and conclusions.
The only remaining issue is determining the appropriate discipline for respondent's
violations. At the panel hearing, the Disciplinary Administrator's office recommended the
respondent's license be indefinitely suspended with an effective date made retroactive to
December 23, 2016, and a reinstatement hearing if respondent applied for reinstatement.
The hearing panel unanimously agreed with the recommendation.
The hearing panel's recommendations are advisory only and do not prevent us
from imposing greater or lesser sanctions. Supreme Court Rule 212(f); In re Kline, 298
Kan. 96, 212-13, 311 P.3d 321 (2013).
After careful consideration, the court holds the respondent should be indefinitely
suspended effective as of the date of this order and that he be subject to a reinstatement
hearing under Supreme Court Rule 219 (2018 Kan. S. Ct. R. 264) before his suspension
may be lifted. At the reinstatement hearing, respondent must provide to the hearing panel
and the Disciplinary Administrator's office a written report from a licensed psychiatric,
psychological, or social work professional approved by the Kansas Lawyers Assistance
Program that includes an opinion that there are no current impediments to respondent's
ability to practice law. Further, respondent must provide to the hearing panel a plan under
which his law practice after reinstatement will be supervised, for a period of time to be
set by this court, by an attorney acceptable to the Disciplinary Administrator's office, and
containing provisions designed to prevent recurrence of the problems that led to the
indefinite suspension.
In ordering this effective date, contrary to the recommended effective date, the
court considered the serious nature of the violations detailed in the panel's report; the
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violations' similarity to the misconduct in the previous disciplinary case; and the
respondent's affirmative statement at his earlier hearing before this court that there were
no additional problems in his practice, even though he knew then he had engaged in the
misconduct at issue in this case.
The court acknowledges the strides respondent has achieved in his rehabilitation
and the considerable contributions by respondent's fellow attorneys, family, and
community members assisting with those successes.
CONCLUSION AND DISCIPLINE
IT IS THEREFORE ORDERED that Jeffery A. Mason be and he is hereby disciplined
by indefinite suspension, effective on the filing of this opinion, in accordance with
Supreme Court Rule 203(a)(2) (2018 Kan. S. Ct. R. 234).
IT IS FURTHER ORDERED that respondent comply with Supreme Court Rule 218
(2018 Kan. S. Ct. R. 262) and Rule 219. At the reinstatement hearing, respondent must
provide to the hearing panel and the Disciplinary Administrator's office a written report
from a licensed psychiatric, psychological, or social work professional approved by the
Kansas Lawyers Assistance Program that includes an opinion that there are no current
impediments to respondent's ability to practice law. Further, respondent must provide to
the hearing panel a plan under which his law practice after reinstatement will be
supervised, for a period of time to be set by this court, by an attorney acceptable to the
Disciplinary Administrator's office, and containing provisions designed to prevent
recurrence of the problems that led to the indefinite suspension.
IT IS FURTHER ORDERED that the costs of these proceedings be assessed to
respondent and that this opinion be published in the official Kansas Reports.
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NUSS, C.J., and LUCKERT, J., not participating.
THOMAS KELLY RYAN and OLIVER KENT LYNCH, District Judges, assigned.1
1
REPORTER'S NOTE: District Judge Ryan and District Judge Lynch were appointed
to hear case No. 119,012 vice Chief Justice Nuss and Justice Luckert respectively under
the authority vested in the Supreme Court by art. 3, § 6(f) of the Kansas Constitution.
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