                                                         2017 WI 93

                  SUPREME COURT            OF   WISCONSIN
CASE NO.:               2016AP2454-D
COMPLETE TITLE:         In the Matter of Disciplinary Proceedings
                        Against Janet L. Heins, Attorney at Law:

                        Office of Lawyer Regulation,
                                  Complainant,
                             v.
                        Janet L. Heins,
                                  Respondent.

                             DISCIPLINARY PROCEEDINGS AGAINST HEINS

OPINION FILED:          October 19, 2017
SUBMITTED ON BRIEFS:
ORAL ARGUMENT:

SOURCE OF APPEAL:
   COURT:
   COUNTY:
   JUDGE:

JUSTICES:
   CONCURRED:
   DISSENTED:
   NOT PARTICIPATING:


ATTORNEYS:
                                                                              2017 WI 93
                                                                      NOTICE
                                                        This opinion is subject to further
                                                        editing and modification.   The final
                                                        version will appear in the bound
                                                        volume of the official reports.
No.    2016AP2454-D


STATE OF WISCONSIN                                  :             IN SUPREME COURT

In the Matter of Disciplinary Proceedings
Against Janet L. Heins, Attorney at Law:

Office of Lawyer Regulation,                                               FILED
           Complainant,                                               OCT 19, 2017
      v.                                                                 Diane M. Fremgen
                                                                      Clerk of Supreme Court
Janet L. Heins,

           Respondent.




      ATTORNEY       disciplinary         proceeding.            Attorney         publicly

reprimanded.


      ¶1   PER     CURIAM.     We     review    a       report    filed     by    Referee

James W. Mohr, Jr., concluding, based on a stipulation filed by

the Office of Lawyer Regulation (OLR) and Attorney Janet L.

Heins, that Attorney Heins committed six counts of professional

misconduct    as     alleged   in   the    OLR's        complaint.         The    referee

agrees with the parties that a public reprimand is appropriate

discipline     for     Attorney     Heins'      misconduct.               The      referee

recommends,    consistent      with    the     stipulation,         that     we    require
Attorney   Heins     to   submit    the    attorney        fee     dispute       with   her
                                                                          No.     2016AP2454-D



former client, J.R., to binding arbitration, that we direct her

to    abide    by    any    ensuing    arbitration            order,    and     that   she     be

assessed the full costs of the proceeding, which are $2,378.02

as of July 24, 2017.

       ¶2     After careful review, we accept the referee's factual

findings, conclusions of law, and recommendation.                                We commend

the    referee       for    his    report,    which      helpfully        sets    forth       the

framework          for     consideration      of        the     parties'        stipulation,

establishes the factual basis for his legal conclusions, and

provides      a     reasoned       analysis       and    authority        supporting          his

recommendation to accept the stipulated discipline.

       ¶3     We agree that a public reprimand is appropriate here,

and we agree that Attorney Heins should be required to submit

her fee dispute with J.R. to binding arbitration, to comply with

any resulting arbitration award, and that she shall bear the

full       costs    of     this    proceeding.            The     OLR     does     not       seek

restitution         and,    based     on   this     record,       restitution          is     not

warranted at this time.
       ¶4     Attorney        Heins    was    admitted          to      practice       law    in

Wisconsin in 1991.                She resides and practices law in Mequon.

She has no prior discipline.1


       1
       On April 19, 2016, this court, in response to a motion
from the OLR, issued an order directing Attorney Heins to show
cause, in writing, why her license should not be suspended for
willful failure to cooperate with the OLR's investigation into
one of the matters at issue here.      On May 4, 2016, the OLR
received a response from Attorney Heins and withdrew its motion.


                                              2
                                                                       No.       2016AP2454-D



     ¶5     On       December   15,     2016,    the     OLR       filed     a       six-count

complaint against Attorney Heins alleging misconduct involving

three client matters.           The OLR initially sought a 60-day license

suspension and an order requiring Attorney Heins to submit a fee

dispute with a client to binding arbitration.                         Attorney Heins,

by counsel, filed an Answer characterizing the OLR's allegations

as   a    failure       "to     fully     meet       a      handful        of        technical

requirements."

     ¶6     Referee Mohr was appointed.                  At an ensuing scheduling

conference, the referee scheduled a two-day evidentiary hearing

to commence June 19, 2017.

     ¶7     On June 14, 2017, the OLR and Attorney Heins executed

and filed a stipulation.                In the stipulation, Attorney Heins

states that she:

     [A]dmits the allegations contained in that Complaint
     and agrees that OLR can prove the allegations of six
     (6) counts of misconduct and that the referee may use
     the factual allegations in the Complaint as an
     adequate   factual  basis   in  the   record  for   a
     determination of misconduct as to each of those
     counts.
     ¶8     The       stipulation     further        provides       that     the       parties

agree    that    a    public    reprimand       is    the    appropriate             level   of

discipline for Attorney Heins' misconduct and that she should be

ordered    to     submit      her   fee    dispute          with    J.R.        to    binding

arbitration before the State Bar Fee Arbitration Program and

comply with any arbitration award, subject to any rights and

remedies provided for by the Program's rules.




                                           3
                                                                   No.   2016AP2454-D



      ¶9      In the stipulation, Attorney Heins further avers that

the stipulation did not result from plea bargaining; she fully

understands the misconduct allegations; she fully understands

her   right    to   contest    the     matter;    she    fully    understands    the

ramifications       of   her   entry     into    the    stipulation;     she   fully

understands her right to consult with counsel, states that she

has in fact consulted with counsel; and states that her entry

into the stipulation is made knowingly and voluntarily.

      ¶10     The   referee    noted     that    this    stipulation     was   filed

after all discovery was completed, shortly before the hearing.

The referee observed that the effect of the stipulation was

essentially an admission to all of the material allegations of

the   complaint.         The   referee    construed      the     stipulation    as   a

withdrawal of all defenses to the complaint and a plea of no

contest.      Proceeding consistent with SCR 22.14(2),2 the referee

ascertained whether there was an adequate factual basis for each

allegation, then made a determination of misconduct with respect

to each allegation.
      2
          SCR 22.14(2) provides:

            The respondent may by answer plead no contest to
      allegations of misconduct in the complaint.        The
      referee shall make a determination of misconduct in
      respect to each allegation to which no contest is
      pleaded and for which the referee finds an adequate
      factual basis in the record.         In a subsequent
      disciplinary or reinstatement proceeding, it shall be
      conclusively presumed that the respondent engaged in
      the misconduct determined on the basis of a no contest
      plea.




                                          4
                                                                          No.    2016AP2454-D



       ¶11       The first two counts of the complaint involve Attorney

Heins' representation of J.R.                    The complaint alleged and the

parties stipulated that Attorney Heins represented J.R. in an

employment matter.               On February 16, 2012, they entered into a

written fee agreement providing that $25,000 in advance fees

paid       by    J.R.    would    be    placed    in    Attorney        Heins'     business

account.         The written agreement further provided that Attorney

Heins      would       provide   an    accounting      of   the    fees    earned.       The

agreement provided that if there was any dispute about fees, she

would give notice to J.R. and, if the dispute was not resolved,

she would submit the dispute to binding arbitration through the

State Bar Fee Arbitration Program.

       ¶12       By December 2014, all but $645.23 of the $25,000 in

advance         fees    had    been    billed.    J.R.      made    a     second    advance

payment of fees in the amount of $3,000.

       ¶13       In January 2015, Attorney Heins sought to withdraw as

counsel for J.R., citing health issues.                      On February 12, 2015,

she    sent      J.R    a     "Final   Statement"      of   fees.         Attorney    Heins
indicated that a refund in the amount of $1,411.53 was due and

she paid that amount to him.                The statement did not contain the

notices required by former SCR 20:1.15(b)(4m)b.3
       3
       Effective July 1, 2016, substantial changes were made to
Supreme Court Rule 20:1.15, the "trust account rule."      See S.
Ct. Order 14-07, (issued Apr. 4, 2016, eff. July 1, 2016).
Because the conduct underlying this case arose prior to July 1,
2016, unless otherwise indicated, all references to the supreme
court rules will be to those in effect prior to July 1, 2016.

       Former SCR 20:1.15(b)(4m)b. provided:
                                                                                (continued)
                                             5
                                                           No.   2016AP2454-D



    ¶14   Ten days later, on February 22, 2015, J.R. notified

Attorney Heins that he disputed the fees charged and asked for a

"significant refund" of the total $28,000 he had paid.

    ¶15   On   February   24,   2015,   Attorney   Heins    indicated    she

would not be making an additional refund.            On March 2, 2015,

J.R. again disputed the fees.           In the summer of 2015, J.R.

submitted the fee dispute with Attorney Heins to the State Bar

Fee Arbitration Program.

         A lawyer who accepts advanced payments of fees
    may deposit the funds in the lawyer's business
    account, provided that review of the lawyer's fee by a
    court of competent jurisdiction is available in the
    proceeding to which the fee relates, or provided that
    the lawyer complies with each of the following
    requirements:

         b. Upon termination of the representation, the
    lawyer shall deliver to the client in writing all of
    the following:

          1. a final accounting, or an accounting from the
    date of the lawyer's most recent statement to the end
    of the representation, regarding the client's advanced
    fee payment with a refund of any unearned advanced
    fees;

         2. notice that, if the client disputes the amount
    of the fee and wants that dispute to be submitted to
    finding arbitration, the client must provide written
    notice of the dispute to the lawyer within 30 days of
    the mailing of the accounting; and

         3. notice that, if the lawyer is unable to
    resolve the dispute to the satisfaction of the client
    within 30 days after receiving notice of the dispute
    from the client, the lawyer shall submit the dispute
    to binding arbitration.




                                   6
                                                                  No.    2016AP2454-D



       ¶16       Attorney Heins did not respond to any correspondence

sent to her by the State Bar Fee Arbitration Program and failed

to submit to arbitration.

       ¶17       Count One of the complaint alleged that, by failing to

provide to J.R., at the termination of her representation of

him,       all    notices    required    by   former     SCR    20:1.15(b)(4m)b.,

Attorney Heins violated that rule.

       ¶18       Count Two alleged that, by failing to submit the fee

dispute with J.R. to arbitration, Attorney Heins violated former

SCR 20:1.15(b)(4m)c.,4 which provided that upon timely receipt of

written notice of a dispute from the client, the lawyer shall

attempt to resolve that dispute with the client, and if the

dispute is not resolved, the lawyer shall submit the dispute to

binding arbitration with the State Bar Fee Arbitration Program

or a similar local bar association program.

       ¶19       The   referee   found   that,   based   upon    Attorney    Heins'

admission that her final statement to J.R. of February 12, 2015,

"did        not        contain    the     notices      required         by   former
SCR 20:l.15(b)(4m)b.2. and 3." and based upon the absence of any


       4
           Former SCR 20:1.15(b)(4m)c. provided:

            Upon timely receipt of written notice of a
       dispute from the client, the lawyer shall attempt to
       resolve that dispute with the client, and if the
       dispute is not resolved, the lawyer shall submit the
       dispute to binding arbitration with the State Bar Fee
       Arbitration Program or a similar local bar association
       program within 30 days of the lawyer's receipt of the
       written notice of dispute from the client.


                                          7
                                                                     No.     2016AP2454-D



information in the record that a court of competent jurisdiction

approved Attorney Heins' fee, the referee found there was an

adequate factual basis in the record to support the misconduct

alleged in Count One.

       ¶20    The   referee      found    that,      based   upon    Attorney     Heins'

admission that she did not respond to or participate in the

State Bar Fee Arbitration Program, there was an adequate factual

basis in the record to support the misconduct alleged in Count

Two.

       ¶21    Counts Three through Five of the complaint involved

Attorney Heins' representation of M.I. in connection with an

employment      matter.          In   early       November   2015,   M.I.     opted    to

settle;      settlement     funds     were    deposited      into    Attorney     Heins'

trust account on November 3, 2015.                   M.I. was entitled to $3,750

of the funds.

       ¶22    By    early   December      2015,      M.I.    had   not    received    his

portion of the settlement.               Over the next month, M.I. exchanged

several emails with Attorney Heins regarding the funds.
       ¶23 On January 19, 2016, Attorney Heins drafted a check

from her client trust account to M.I. for the funds.                         The check

was twice rejected for insufficient funds, resulting in fees

charged to M.I. by his own bank.

       ¶24    On    March   1,    2016,    Attorney      Heins     drafted    a   second

check which included the bank charges M.I. had incurred, plus

his portion of the fees.              That check was honored.

       ¶25    The    OLR    examined      Attorney     Heins'      bank    records    and
determined that between November 3, 2015, and January 31, 2016,
                                              8
                                                                         No.    2016AP2454-D



the balance in her trust account was below the amount that was

owed to M.I.

       ¶26       Between February 2016 and April 2016, the OLR sent

Attorney        Heins    a   series    of   letters        seeking      her    response   to

allegations regarding M.I., and advising Attorney Heins of her

duty       to     cooperate       with      the      OLR's       investigation         under

SCR 21.15(4) and SCR 22.03(6).                 Attorney Heins did not submit a

complete or timely response.                   Eventually, on April 19, 2016,

this court issued an order                  directing Attorney Heins to show

cause      why    her    license      should       not   be   suspended        for   willful

failure to cooperate with the investigation.                            On May 4, 2016,

the OLR received, via fax from Attorney Heins, a response to the

OLR's letter of March 25, 2016.                          The OLR then withdrew its

motion.

       ¶27       Count Three alleged that by failing to hold in trust

funds        belonging         to      M.I.,         Attorney        Heins           violated

SCR 20:1.15(b)(l).5

       ¶28       The    referee     found   that,        based   upon    the    undisputed
evidence that there were, at various times, insufficient funds

in Attorney Heins' trust account to pay M.I. what was owed him,

       5
           SCR 20:1.15(b)(l) provides:

            A lawyer shall hold in trust, separate from the
       lawyer's own property, that property of clients and
       3rd parties that is in the lawyer's possession in
       connection with a representation. All funds of clients
       and 3rd parties paid to a lawyer or law firm in
       connection with a representation shall be deposited in
       one of more identifiable trust accounts.


                                               9
                                                                    No.     2016AP2454-D



there was an adequate factual basis in the record to support the

claim of misconduct in Count Three.

     ¶29    Count Four alleged that by failing to promptly deliver

to M.I. the settlement funds belonging to him, Attorney Heins

violated former SCR 20:1.15(d)(1).6

     ¶30    The     referee     found   that     based      upon    the     undisputed

factual    admissions     in     the    record       that    Attorney       Heins   had

received settlement funds on November 3, 2015, but did not pay

them to M.I. until on or after March 1, 2016, Attorney Heins did

not "promptly deliver to the client" the settlement funds that

the client was entitled to receive and that therefore there was

an   adequate       factual     basis   in     the    record       to     support   the

misconduct alleged in Count Four.

     ¶31    Count Five alleged that by failing to timely respond

to the OLR's investigative letters of February 17 and February

22, 2016, Attorney Heins violated SCR 22.03(2), enforceable by

SCR 20:8.4(h), and, by willfully failing to timely provide the

trust     account     records     requested      in    the     OLR's      letters    of


     6
         Former SCR 20:1.15(d)(1) provided:

          Upon receiving funds or other property in which a
     client has an interest, or in which the lawyer has
     received notice that a 3rd party has an interest
     identified by a lien, court order, judgment, or
     contract, the lawyer shall promptly notify the client
     or 3rd party in writing.      Except as stated in this
     rule or otherwise permitted by law or by agreement with
     the client, the lawyer shall promptly deliver to the
     client or 3rd party any funds or other property that
     the client or 3rd party is entitled to receive.


                                         10
                                                      No.     2016AP2454-D



February 17    and   March   25,   2016,   Attorney   Heins     violated

SCR 22.03(2) and (6),7 enforceable by SCR 20:8.4(h).8

     ¶32    The referee found that based upon the undisputed facts

in the record that Attorney Heins refused on several occasions

to furnish information requested by the OLR in correspondence,

and only supplied the complete information after the OLR was

required to file a Motion and Order to Show Cause, there was an

adequate factual basis in the record to support the misconduct

alleged in Count Five.

     7
         SCR 22.03(2) and (6) provide:

          (2) Upon    commencing  an   investigation,   the
     director shall notify the respondent of the matter
     being investigated unless in the opinion of the
     director the investigation of the matter requires
     otherwise.    The respondent shall fully and fairly
     disclose all facts and circumstances pertaining to the
     alleged misconduct within 20 days after being served
     by ordinary mail request for a written response. The
     director may allow additional time to respond.
     Following receipt of the response, the director may
     conduct further investigation and may compel the
     respondent to answer questions, furnish documents, and
     present any information deemed relevant to the
     investigation.

          (6) In the course of the investigation, the
     respondent's   wilful  failure   to  provide  relevant
     information, to answer questions fully, or to furnish
     documents and the respondent's misrepresentation in a
     disclosure are misconduct, regardless of the merits of
     the matters asserted in the grievance.
     8
       SCR 20:8.4(h) provides:    "It is professional misconduct
for a lawyer to fail to cooperate in the investigation of a
grievance filed with the office of lawyer regulation as required
by   SCR   21.15(4),   SCR   22.001(9)(b),  SCR   22.03(6),   or
SCR 22.04(1)."


                                   11
                                                                           No.     2016AP2454-D



       ¶33     Count     Six        of    the        complaint       alleged        that     on

September 10, 2015, another of Attorney Heins' clients, M.J.,

presented for payment a check from Attorney Heins' trust account

in the amount of $600, representing his portion of a settlement.

The check was returned for insufficient funds.                                On that date

Attorney Heins had a zero balance in her trust account.

       ¶34     The     following         day,     Attorney        Heins     made       deposits

totaling $600 into her trust account.                           M.J. again presented the

check on September 16, 2015.                    This time, the check cleared the

bank.

       ¶35     Count Six alleged that by failing to hold in trust

funds        belonging         to        M.J.,          Attorney         Heins         violated

SCR 20:l.15(b)(1).             The       referee      found      that,     based    upon    the

undisputed evidence in the record, that the $600, which was owed

to M.J., was not in Attorney Heins' trust account when the check

was first presented for payment, there was an adequate factual

basis in the record to support misconduct as alleged in Count

Six.
       ¶36     Accordingly, based upon the stipulation filed on June

14,    2017,    and    for   the     reasons         set   forth     above,      the   referee

found, as proven fact, each and every factual allegation in the

OLR's complaint.          Further, the referee concluded that the record

was sufficient to support his determination that Attorney Heins

violated       the    supreme       court       rules      as    alleged    in     the    OLR's

complaint.




                                                12
                                                                   No.     2016AP2454-D



       ¶37       No appeal from the referee's report was filed so our

review proceeds under SCR 22.17(2).9                 In conducting our review,

we uphold a referee's findings of fact unless they are shown to

be clearly erroneous, and we review the referee's conclusions of

law    de    novo.       See    In   re    Disciplinary     Proceedings       Against

Carroll, 2001 WI 130, ¶29, 248 Wis. 2d 662, 636 N.W.2d 718; In

re    Disciplinary      Proceedings       Against    Sosnay,      209    Wis. 2d 241,

243, 562 N.W.2d 137 (1997).               We determine the appropriate level

of discipline to be imposed under the circumstances, independent

of     the referee's      recommendation.            See   In     re     Disciplinary

Proceedings Against Widule, 2003 WI 34, ¶44, 261 Wis. 2d 45, 660

N.W.2d 686.

       ¶38       There is no showing that any of the referee's findings

of fact, which are derived from the parties' stipulation, are

clearly erroneous.           Accordingly, we adopt them.                We also agree

with       the   referee's     conclusions      of   law   that    Attorney     Heins

violated the supreme court rules set forth above.

       ¶39       The referee then considered the appropriate discipline
for Attorney Heins' misconduct.                 The parties jointly requested

the referee recommend a public reprimand and that Attorney Heins

       9
           SCR 22.17(2) provides:

            If no appeal is filed timely, the supreme court
       shall review the referee's report; adopt, reject or
       modify the referee's findings and conclusions or
       remand the matter to the referee for additional
       findings;   and   determine  and   impose  appropriate
       discipline.   The court, on its own motion, may order
       the parties to file briefs in the matter.


                                           13
                                                                            No.    2016AP2454-D



be    ordered    to       submit   her   fee      dispute         with     J.R.   to   binding

arbitration before the State Bar Fee Arbitration Program and

comply with any arbitration award, subject to any rights or

remedies provided for by the Program's rules.

       ¶40    The     referee      conducted      an     independent         assessment      of

whether the stipulated discipline was appropriate.                                The referee

set     forth       the     relevant      factors           to     be      considered      when

ascertaining the appropriate sanction for misconduct, including

the seriousness, nature, and extent of misconduct, the level of

discipline needed to protect the public and the legal system

from repetition of the misconduct, the need to impress on the

attorney the seriousness of the misconduct, and the need to

deter others from committing similar acts.                              In re Disciplinary

Proceedings      Against       Hammis,     2011        WI    3,    331     Wis. 2d 19,      793

N.W.2d 884.

       ¶41    The referee observed that there was no evidence of

prior    disciplinary         proceedings         against         Attorney    Heins.        The

referee noted that this proceeding involves misconduct in three
separate      client        matters,      including              failure     to    abide    by

agreements with a client, failure to obey supreme court rules

concerning       fee      disputes,      several        trust       account       violations,

including       being      "out    of    trust"     on      numerous        occasions,      and

failure to cooperate with the OLR's investigation.                                The referee

deemed these "serious allegations of misconduct extending over

several      years."        The    referee     deemed        particularly         troublesome

Attorney Heins' refusal to follow through on both her written


                                             14
                                                                       No.     2016AP2454-D



agreement and supreme court rule requiring participation in the

State Bar Fee Arbitration Program.

       ¶42    The referee observed that on previous occasions, this

court has imposed public reprimands in similar cases.                                In re

Disciplinary Proceedings Against Halverson, 225 Wis. 2d 215, 591

N.W.2d 821 (1999) (public reprimand imposed on attorney with no

prior discipline who failed to supply requested information to

clients, failed to refund fees, and failed to cooperate with

OLR);    In    re    Disciplinary        Proceedings         Against     Grapsas,       174

Wis. 2d 816, 498 N.W.2d 400 (1993) (imposing public reprimand on

attorney with no prior discipline who failed to cooperate with

OLR, failed to refund fees to a client, and failed to respond to

requests for information from the client); In re Disciplinary

Proceedings        Against   Adent,      2016    WI    19,    367    Wis. 2d 372,       877

N.W.2d 364 (accepting stipulation and imposing public reprimand

on attorney for trust account violations).

       ¶43    On    balance,     the    referee       determined       that     a    public

reprimand      is    appropriate       discipline      here    and     that    the    court
should order Attorney Heins to submit her fee dispute with J.R.

to   binding       arbitration    before    the       State    Bar     Fee    Arbitration

Program, and to fully and promptly comply with that proceeding

as well as with any arbitration award or other orders that may

be made in connection with those proceedings.                        The referee added

that    if    Attorney   Heins     fails    to    comply,       the     OLR    should   be

authorized to request the court re-open this matter to consider

additional      discipline.        Finally,       the        referee    recommends       we


                                           15
                                                                No.        2016AP2454-D



impose the full costs of this proceeding on Attorney Heins.                            We

agree with the referee's analysis.

       ¶44    IT    IS   ORDERED   that     Janet   L.    Heins       is        publicly

reprimanded.

       ¶45    IT IS FURTHER ORDERED that Janet L. Heins shall, if

she has not already done so, promptly submit her fee dispute

with   J.R.    to    binding   arbitration     before     the   State           Bar   Fee

Arbitration Program, and shall fully and promptly comply with

that proceeding as well as with any arbitration award or other

orders that may be made in connection with those proceedings.

       ¶46    IT IS FURTHER ORDERED that within 60 days of the date

of this order, Janet L. Heins shall pay to the Office of Lawyer

Regulation the costs of this proceeding, which are $2,378.02 as

of July 24, 2017.

       ¶47    IT IS FURTHER ORDERED that the Director of the Office

of Lawyer Regulation shall advise the court if there has not

been full compliance with all conditions of this order.                                If

Janet L. Heins fails to comply with our directive to submit her
fee    dispute      to   binding   arbitration,     the    Office          of    Lawyer

Regulation may request the court re-open this matter to consider

imposition of additional sanctions.




                                       16
    No.   2016AP2454-D




1
