State ex rel. Counsel for Dis. v. Sipp , 314 Neb. 208 ( 2023 )

Nebraska Supreme Court Online Library
www.nebraska.gov/apps-courts-epub/
05/12/2023 09:06 AM CDT
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314 Nebraska Reports
STATE EX REL. COUNSEL FOR DIS. V. SIPP
Cite as 314 Neb. 208State of Nebraska ex rel. Counsel for Discipline
of the Nebraska Supreme Court, relator,
v. Bradley A. Sipp, respondent.
___ N.W.2d ___
Filed May 12, 2023. No. S-21-832.
Original action. Judgment of suspension.
Heavican, C.J., Miller-Lerman, Cassel, Funke, Papik,
and Freudenberg, JJ.
Per Curiam.
INTRODUCTION
The relator, the Counsel for Discipline of the Nebraska
Supreme Court, filed formal charges against the respondent,
Bradley A. Sipp, alleging that the respondent violated several
provisions of the Nebraska Rules of Professional Conduct.
The respondent admitted to violating Neb. Ct. R. of Prof.
Cond. §§ 3-501.3 (diligence), 3-501.4 (client communica-
tions), 3-508.1 (failure to respond to disciplinary authority),
and 3-508.4(a) (misconduct) (rev. 2016). After a hearing, the
referee found that the respondent also violated Neb. Ct. R. of
Prof. Cond. § 3-501.15(a) and (c) (failure to deposit unearned
fees into trust account and withdraw only as earned). The
referee recommended that the respondent be suspended from
the practice of law in the State of Nebraska for 9 months,
followed by 9 months’ monitored probation. The respondent
takes exception to the recommended sanction. We agree with
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STATE EX REL. COUNSEL FOR DIS. V. SIPP
Cite as 314 Neb. 208the referee’s recommendation and impose discipline as indi-
cated below.
BACKGROUND
The respondent was admitted to the practice of law in the
State of Nebraska on September 16, 2008. At all times relevant
to these proceedings, the respondent was engaged in the private
practice of law in Lincoln, Nebraska.
The Counsel for Discipline filed amended formal charges
against the respondent on January 10, 2022, arising from his
representation of four separate clients between 2019 and 2021.
The charges generally alleged neglect of client matters, fail-
ure to communicate with clients, failure to timely respond to
the Counsel for Discipline, and failure to deposit “advance
fees” paid to the respondent by clients into the respondent’s
trust account.
Ultimately, the respondent admitted to violating §§ 3-501.3,
3-501.4, 3-508.1, and 3-508.4(a). The respondent denied vio-
lating § 3-501.15(a) and (c). However, after a hearing, the ref-
eree found by clear and convincing evidence that the respond­
ent also violated the rules as to the deposit of unearned fees
into a trust account and their withdrawal as earned. The
respondent had argued that he earned the “initial [fee] depos-
its” upon receipt under the terms of the fee agreement and thus
could not place them in his trust account without impermis-
sibly commingling his funds with clients’ funds. The referee
disagreed, finding that the initial deposits were for work yet to
be performed and were not earned when given.
The referee recommended that the respondent be suspended
from the practice of law in the State of Nebraska for 9
months, followed by 9 months’ monitored probation. The
referee acknowledged various mitigating factors noted by the
Counsel for Discipline, including that the respondent had no
prior disciplinary sanctions, eventually cooperated with the
Counsel for Discipline, admitted his misconduct and assumed
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STATE EX REL. COUNSEL FOR DIS. V. SIPP
Cite as 314 Neb. 208responsibility for his actions, appears remorseful, refunded
the fee deposits of three of the four clients, and apparently
has a good reputation in his community. However, the referee
took issue with the respondent’s claim that “‘from this record,
all the clients were made whole and their cases resolved
to their satisfaction.’” The recommended sanctions were
based on the respondent’s admitted violations of §§ 3-501.3,
3-501.4, 3-508.1, and 3-508.4(a). The Counsel for Discipline
did not seek sanctions for the violations of § 3-501.15(a) and
(c), and the referee did not recommend any sanctions for
those violations.
STANDARD OF REVIEW
Because attorney discipline cases are original proceedings
before this court, we review a referee’s recommendations de
novo on the record, reaching a conclusion independent of the
referee’s findings. 1
ANALYSIS
The basic issues in a disciplinary proceeding against a
lawyer are whether discipline should be imposed and, if so,
the type of discipline appropriate under the circumstances. 2
In the present case, however, there does not appear to be any
dispute as to whether discipline should be imposed. Violation
of a disciplinary rule concerning the practice of law is a
ground for discipline, 3 and the respondent admitted to violat-
ing §§ 3-501.3, 3-501.4, 3-508.1, and 3-508.4(a) and takes no
exception to the referee’s finding that he violated § 3-501.15(a)
and (c). As such, the sole issue is the type of discipline
appropriate under the circumstances. The respondent takes
1
State ex rel. Counsel for Dis. v. Castrejon, 311 Neb. 560, 973 N.W.2d 701(2022).
2
Id.3
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STATE EX REL. COUNSEL FOR DIS. V. SIPP
Cite as 314 Neb. 208exception to the referee’s recommendation of 9 months’ sus-
pension, followed by 9 months’ monitored probation, on the
grounds that it is excessive and based upon factors and con-
clusions that are not supported by the evidence. Instead, the
respondent argues for a public reprimand, term of probation, or
30 days’ suspension.
Under Neb. Ct. R. § 3-304, this court may impose one or
more of the following disciplinary sanctions: “(1) Disbarment
by the Court; or (2) Suspension by the Court; or (3) Probation
by the Court in lieu of or subsequent to suspension, on such
terms as the Court may designate; or (4) Censure and rep-
rimand by the Court; or (5) Temporary suspension by the
Court[.]” The goal of attorney discipline proceedings is not
as much punishment as a determination of whether it is in the
public interest to allow an attorney to keep practicing law. 4
Providing for the protection of the public requires the imposi-
tion of an adequate sanction to maintain public confidence in
the bar. 5
To determine whether and to what extent discipline should
be imposed in an attorney discipline proceeding, we consider
the following factors: (1) the nature of the offense, (2) the
need for deterring others, (3) the maintenance of the reputation
of the bar as a whole, (4) the protection of the public, (5) the
attitude of the respondent generally, and (6) the respondent’s
present or future fitness to continue in the practice of law. 6
Each attorney discipline case must be evaluated in light of
its particular facts and circumstances. 7 For purposes of deter-
mining the proper discipline of an attorney, we consider the
4
State ex rel. Counsel for Dis. v. Barfield, 305 Neb. 79, 938 N.W.2d 863(2020).
5
Id.6
Castrejon, supra note 1.
7
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STATE EX REL. COUNSEL FOR DIS. V. SIPP
Cite as 314 Neb. 208attorney’s actions both underlying the events of the case and
throughout the proceeding, as well as any aggravating or miti-
gating factors. 8 Furthermore, the propriety of a sanction must
be considered with reference to the sanctions imposed in prior
similar cases. 9
The evidence in the present case establishes that there were
several types of misconduct, including neglect of client mat-
ters and failure to communicate with clients. The respondent
suggested at oral arguments before this court that he was
performing the work but did not inform his clients. However,
he admitted to violating both §§ 3-501.3 and 3-501.4, and the
record shows multiple instances in which he neglected mat-
ters entrusted to him by clients. Notably, despite having been
retained by one client in part to settle a debt, the respondent
failed to respond to an inquiry from opposing counsel about
whether his client was interested in settling, and “at no time
thereafter made any attempt to negotiate . . . to settle [the]
claim.” The respondent also failed to timely submit a brief
in that client’s appeal. As to another client, the respondent
submitted no evidence on her behalf at a contested divorce
hearing. And with yet another client, the respondent agreed
to seek a pardon, but then stopped communicating with the
client and subsequently admitted he had not represented the
client with the “‘diligence that was necessary.’” In addition,
the respondent failed to timely respond to multiple inquiries
from the Counsel for Discipline and never provided certain
requested documents.
A lawyer who neglects an entrusted matter has failed to
act competently and is guilty of unprofessional conduct. 10
8
Id.
9
State ex rel. Counsel for Dis. v. Argyrakis, 305 Neb. 396, 940 N.W.2d 279(2020).
10
State ex rel. NSBA v. Aupperle, 256 Neb. 953, 594 N.W.2d 602 (1999).
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and the maintenance of the reputation of the bar as a whole
are of paramount concern. 11 Similarly, responding to discipli­
nary complaints in an untimely manner and repeatedly ignor-
ing requests for information from the Counsel for Discipline
indicate a disrespect for the Supreme Court’s disciplinary
jurisdiction and a lack of concern for protecting the public, the
profession, and the administration of justice. 12
The referee viewed State ex rel. Counsel for Dis. v. Gase 13
as similar in that the respondent there was the subject of three
separate grievances generally alleging neglect of client mat-
ters and failure to communicate with clients, and the respond­
ent failed to timely respond to the Counsel for Discipline.
We suspended the respondent in Gase for 1 year, followed by
1 year’s monitored probation. 14 The respondent here argues
that Gase is distinguishable because Gase involved a condi-
tional admission, 15 and the record in Gase apparently did not
include mitigating circumstances or letters or testimonials
in favor of the respondent. 16 However, other cases involving
multiple instances of neglect of client matters, failure to com-
municate with clients, and failure to timely respond to the
Counsel for Discipline have also resulted in similar sanctions,
even though they did not involve conditional admissions
11
Id.12
State ex rel. Counsel for Dis. v. Nelson, 311 Neb. 251, 971 N.W.2d 777(2022).
13
State ex rel. Counsel for Dis. v. Gase, 283 Neb. 479, 811 N.W.2d 169(2012).
14
Id.15
See, generally, Neb. Ct. R. § 3-313.
16
But see State ex rel. NSBA v. Kelly, 221 Neb. 8, 374 N.W.2d 833(1985) (evidence of good reputation does not necessarily mitigate proved
misconduct).
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STATE EX REL. COUNSEL FOR DIS. V. SIPP
Cite as 314 Neb. 208and even though there was evidence of mitigating circum-
stances or letters and testimonials. 17
The respondent also argues that the referee considered cer-
tain aggravating factors that were not supported by the record
or that overstated the degree of the respondent’s misconduct.
However, the referee’s report makes no reference to aggravat-
ing factors. Instead, the referee discusses—and takes issue
with—the respondent’s view that “‘from this record, all the
clients were made whole and their cases resolved to their satis-
faction’” when discussing mitigating factors.
Relatedly, the respondent argues that the referee “miscon-
strued [his] position” as to his clients’ being made whole and
their cases being resolved to their satisfaction. 18 Specifically,
the respondent argues that he refunded all unearned fees and
that “[his] lack of diligence did not cause additional harm
or prejudice in the disposition of [his clients’] case; or at
least there was no evidence to establish otherwise.” 19 As
proof of this, he notes, among other things, that one client
had “no defense to the debt she owed.” 20 However, we have
17
See, e.g., State ex rel. Counsel for Dis. v. Wadman, 275 Neb. 357, 746
N.W.2d 681 (2008) (respondent suspended for 6 months for neglecting two
clients’ matters, despite mitigating circumstances); State ex rel. Counsel
for Dis. v. Coe, 271 Neb. 319, 710 N.W.2d 863 (2006) (respondent
disbarred for neglecting client matters and failing to respond to Counsel for
Discipline, despite mitigating circumstances); State ex rel. Special Counsel
for Dis. v. Fellman, 267 Neb. 838, 678 N.W.2d 491 (2004) (respondent
suspended for 1 year followed by 2 years’ probation for violations,
including neglecting client’s matter in multiple respects and failing to
respond to Counsel for Discipline, despite mitigating circumstances and
testimonials); Aupperle, supra note 10 (respondent suspended indefinitely,
with no possibility of reinstatement for 2 years, for violations, including
neglecting six separate clients’ matters and failing to communicate with
various clients, despite mitigating circumstances).
18
Brief for respondent at 10.
19
Id.20
Id. at 11.
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Cite as 314 Neb. 208previously explained that the restitution of funds wrongfully
converted by a lawyer, after he or she is faced with legal
accountability, is not an exoneration of the lawyer’s profes-
sional misconduct. 21 Likewise, we have previously recognized
that an attorney’s neglect, in and of itself, is frustrating and
prejudicial for clients. 22
As to the respondent’s failure to deposit clients’ “initial
fee deposits” into his trust account, the referee found that
the respondent violated § 3-501.15(a) and (c). In so finding,
the referee determined that the fee agreements the respondent
entered into with the four clients in question were hourly
fee agreements involving an initial fee deposit against which
the respondent agreed to work at a rate of $250 an hour, and
other charges would be made against the deposit as they were
incurred, as set out in the plain and simple language of the
written fee agreements.
We have repeatedly said that advanced fees are payments
made by a client for the performance of legal services and
belong to the client until earned by the attorney. 23 Nonetheless,
because there was “‘conflicting information’” about the appli-
cation of § 3-501.15, the Counsel for Discipline sought no
sanction as to the respondent’s violations, and the referee
21
Kelly, supra note 16.
22
See Aupperle, supra note 10. See, also, State ex rel. Counsel for Dis. v.
Ellis, 283 Neb. 329, 339, 808 N.W.2d 634, 642 (2012) (attorney’s neglect
cost client opportunity to pursue claim, regardless of whether claim would
have succeeded; alleged lack of prejudice to client from inability to pursue
claim “entitled to little weight” as mitigating factor); State ex rel. Counsel
for Dis. v. James, 267 Neb. 186, 673 N.W.2d 214 (2004) (rejecting claim
that even if attorney had duty to contact estate’s personal representative,
no prejudice occurred as a result of failure to do so, because after
decedent’s death, there was no witness to accident and decedent’s claim
was of little or no value).
23
See, e.g., State ex rel. Counsel for Dis. v. Crawford, 285 Neb. 321, 827
N.W.2d 214 (2013); Fellman, supra note 17.
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STATE EX REL. COUNSEL FOR DIS. V. SIPP
Cite as 314 Neb. 208recommended none. Neither party took exception to this. When
no exceptions to the referee’s findings of fact are filed, we may
consider the referee’s findings final and conclusive. 24 We do so
in the instant case.
The Counsel for Discipline invites us to determine whether
a lawyer may enter into a fee agreement that allows the lawyer
to treat an advance fee payment as earned upon receipt and
not deposit any portion thereof into the lawyer’s trust account.
In making that request, the Counsel for Discipline cites to
two seemingly contradictory advisory opinions regarding when
an attorney must deposit client fees into the attorney’s trust
account and when it is permissible to deposit client fees into
the attorney’s business account. 25 However, the facts of this
case do not squarely put this issue before us, and as such, we
decline the Counsel for Discipline’s invitation. 26
We also observe that although the formal charges accused
the respondent of violating his oath of office, 27 the referee’s
report is silent on the issue. We find that the evidence clearly
and convincingly shows that the respondent violated his oath
of office.
Accordingly, upon due consideration and after a de novo
review of the record and a balancing of the respondent’s
offenses with all mitigating factors, the court agrees with the
referee’s recommendation and concludes that the respondent
should be suspended from the practice of law in the State
of Nebraska for 9 months, followed by 9 months’ moni-
tored probation. The monitor shall be an attorney licensed to
24
State ex rel. Counsel for Dis. v. Hanson, 305 Neb. 566, 941 N.W.2d 193(2020).
25
See Neb. Ethics Adv. Op. for Lawyers No. 79-3 (1979) and Neb. Ethics
Adv. Op. for Lawyers No. 06-2 (2006).
26
But see ABA Comm. on Ethics & Prof. Responsibility, Formal Op. 505
(2023) (discussing fees paid in advance for contemplated services).
27
See Neb. Rev. Stat. § 7-104 (Reissue 2022).
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STATE EX REL. COUNSEL FOR DIS. V. SIPP
Cite as 314 Neb. 208practice in the State of Nebraska and shall be approved by the
Counsel for Discipline.
Consistent with the referee’s recommendation that the
respondent be subjected to 9 months’ monitored probation
like that in Gase, 28 the monitoring plan shall include, but not
be limited to, the following: (1) The respondent shall provide
the monitor with copies of all fee agreements with clients; (2)
the respondent shall provide the monitor with a monthly list
of cases for which the respondent is currently responsible,
which list shall include (a) the date the attorney-client rela-
tionship began, (b) the general type of the case, (c) the date of
the last contact with the client and the last type and date of the
work completed on the file (e.g., pleading, correspondence,
document preparation, discovery, court hearing), (d) the next
type of work and date that work should be completed on
the case, and (e) any applicable statute of limitations and its
date; (3) during the first 6 months of probation, the respond­
ent will personally meet with the monitor on a monthly basis
to review the case list and the status of the cases; (4) the
respondent will review with the monitor his office practices
and continue to work to develop efficient office procedures
that protect the clients’ interests; (5) the monitor shall have
the right to contact the respondent with any questions the
monitor may have regarding the respondent’s then-pending
cases; and (6) if at any time the monitor believes the respond­
ent has violated the Nebraska Rules of Professional Conduct
or has failed to comply with the terms of probation, the
monitor shall report such violation or failure to the Counsel
for Discipline.
CONCLUSION
The respondent is suspended from the practice of law in
the State of Nebraska for a period of 9 months, effective
28
See Gase, supra note 13.
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Cite as 314 Neb. 208immediately. Should the respondent apply for reinstatement,
his reinstatement shall be conditioned upon his being on pro-
bation for a period of 9 months, including monitoring for 9
months following reinstatement, subject to the terms outlined
above. The respondent shall comply with Neb. Ct. R. § 3-316
(rev. 2014), and upon failure to do so, he shall be subject to
punishment for contempt of this court. The respondent is also
directed to pay costs and expenses in accordance with Neb.
Rev. Stat. §§ 7-114 and 7-115 (Reissue 2022) and Neb. Ct.
R. §§ 3-310(P) (rev. 2022) and 3-323(B) within 60 days after
the order imposing costs and expenses, if any, is entered by
this court.
Judgment of suspension.
Stacy, J., not participating.