2011 VT 42


In re Fink (2010-164)
 
2011 VT 42
 
[Filed 15-Apr-2011]
 
NOTICE:  This opinion is
subject to motions for reargument under V.R.A.P. 40 as well as formal revision
before publication in the Vermont Reports.  Readers are requested to
notify the Reporter of Decisions, Vermont Supreme Court, 109 State Street,
Montpelier, Vermont 05609-0801 of any errors in order that corrections may be
made before this opinion goes to press.
 
 

2011 VT 42 

 

No. 2010-164

 

In re Melvin Fink, Esq.


 Original Jurisdiction


 


 


 


 Professional Responsibility Board


 


 


 


 November Term, 2010


 


 


 


 


Lon
  T. McClintock, Chair 


 

Beth DeBernardi, Deputy Disciplinary Counsel, Burlington,
for Petitioner-Appellant/
  Cross-Appellee.
 
Melvin Fink, Pro Se, Ludlow,
Respondent-Appellee/Cross-Appellant.
 
 
PRESENT:  Dooley, Johnson, Skoglund and Burgess, JJ.,
and Grearson, Supr. J., 
           
        Specially Assigned
 
 
¶ 1.            
JOHNSON, J.   A panel of the Professional
Responsibility Board concluded that respondent violated Vermont Rules of
Professional Conduct 1.5(c) and 8.4(a) for failing to put a contingent fee
agreement in writing and for attempting to charge an unreasonable fee. 
The panel recommended that respondent be publicly reprimanded and placed on
probation.  We elected to review that determination on our own
motion.  In this Court, disciplinary counsel argues that respondent’s
actions warrant a suspension of his license.  Respondent claims that he
did not violate the Rules of Professional Conduct, and, alternatively, any
violation warrants only a private admonition.  We conclude that respondent
violated both rules and agree with the panel’s recommendation of a public reprimand
and probation.  
¶ 2.            
The panel found the following facts.  This case stems from a
complaint brought by one of respondent’s former clients, who engaged respondent
in 2006 to represent him in two family court matters—a relief-from-abuse
proceeding instigated by his wife and a divorce action.  Complainant
suffered a serious and permanent injury in a trampoline accident in 2004,
rendering him a quadriplegic.  Soon thereafter, complainant and his wife
retained an attorney from Burlington to represent them in a personal injury
action, and signed a written contingent fee agreement that permitted the
Burlington attorney to retain one-third of any recovery.  The agreement
was signed by complainant’s wife on his behalf because his injury made it impossible
for him to sign for himself.
¶ 3.            
The personal injury action was complex, involving several defendants,
and the risk of no recovery was high.  To assist in the litigation, the
Burlington attorney solicited the help of an experienced, out-of-state lawyer
with a specialty in trampoline cases.  They entered into a written
fee-sharing arrangement, agreeing that the consultant would receive one-third
of the Burlington attorney’s fee.
¶ 4.            
After complainant’s relationship with his wife deteriorated and she
filed for divorce, complainant sought respondent’s help.  Respondent was
admitted to the Vermont Bar in 1969, and works as a sole practitioner.  He
handles a variety of matters, including divorce and personal injury cases.  Respondent
explained to complainant his regular billing practice in divorce matters, which
is to charge an hourly fee and collect a retainer up front.  He agreed,
however, to handle complainant’s case without an initial retainer based on
complainant’s representation that he had no money but expected a recovery in
his personal injury action.  Respondent reviewed his general fee agreement
with complainant even though complainant was not able to sign it. 
Respondent was attentive to the family court matters, but has not billed
complainant for his services.
¶ 5.            
During consultations with respondent about the divorce proceeding,
complainant also discussed his personal injury case.  Between June 2006
and February 2007, respondent had several conversations with complainant about
the personal injury suit.  Respondent facilitated communication between
complainant and his Burlington attorney because respondent was much closer
geographically to complainant and telephone communication was difficult for
complainant.  For example, as part of a settlement against one of the
defendants in the personal injury action, respondent obtained complainant’s
signature on a “Covenant Not to Sue” by signing on complainant’s behalf. 
Respondent was not compensated for this work.
¶ 6.            
Because of complainant’s ongoing domestic issues, he became unhappy with
the Burlington attorney representing both him and his wife in the personal
injury suit and also enlisted respondent’s help in asking the Burlington
attorney to withdraw as his wife’s attorney.  In February 2007,
complainant, respondent, and the Burlington attorney agreed to meet and discuss
the issue.  Respondent arrived at the meeting before the Burlington
attorney and notified complainant that he was no longer willing to assist in
the personal injury matter without compensation.  The two discussed a fee
and agreed that respondent would continue to assist in the personal injury
matter in exchange for twelve percent of complainant’s gross recovery. 
The parties intended this fee to cover respondent’s services in the personal
injury matter only; respondent would bill separately on an hourly basis for his
services in the domestic matter.  At that time, the personal injury claim
had a potential recovery of more than two million dollars.  The case,
however, also involved substantial risk of no recovery.  
¶ 7.            
The panel found that respondent believed that this percentage was
warranted given the high risk of no recovery, the challenges complainant posed
as a client, and the fee respondent received in a previous contingent fee case
that he had worked on with the same Burlington attorney.  This prior
collaboration was a slip-and-fall case in which respondent had solicited the
Burlington attorney’s assistance.  Under their agreement, respondent gave
the Burlington attorney two-thirds of his already negotiated one-third
contingency fee.  In exchange, the Burlington attorney acted as lead
counsel.  Respondent assisted on the case and was involved with
preparation of witnesses for trial.  Based on this experience, respondent
testified that he thought his role would be not only to facilitate
communication with complainant, but also to assist in preparation for
trial.  Respondent did not, however, discuss this expanded role with the
Burlington attorney.  
¶ 8.            
Once the Burlington attorney arrived, he was informed of the parties’
agreement.  The Burlington attorney did not offer respondent a substantive
role in the personal injury litigation.  He had no intention of involving
respondent in the litigation in any manner other than to facilitate
communication with complainant.  His corresponding case note, which was
dictated following the meeting, conveys this understanding of respondent’s role
in the personal injury action.  It states, in relevant part,
I met with
[complainant] today, along with his divorce lawyer,
[respondent] . . . .
 
  . . . .
 
We agreed that I
would communicate with [complainant] through [respondent].  The reason is
because it is difficult to communicate with him by phone where he is.  I
was not comfortable in writing to him and have [sic] the letters floating
around there.  [Complainant] liked the idea of my communicating with him
through [respondent].
 
Respondent asked the Burlington
attorney to draft a letter outlining the twelve percent contingent fee
agreement, but he refused.  The Burlington attorney did not want to be
involved because the amount made him “very uncomfortable.”  He did not,
however, communicate his discomfort to respondent or complainant.  
¶ 9.            
Following the Burlington attorney’s refusal, respondent did not take any
further action to put the agreement in writing.  Respondent did not
provide complainant with a written contingent fee agreement, although he had a
pre-printed contingent fee form he usually used for personal injury
cases.  Respondent testified that he did not prepare a written agreement
because complainant was not able to sign documents and respondent was not aware
of anyone who could sign on complainant’s behalf.  Respondent explained
that he felt that a written document would be unenforceable, and thus useless,
without the client’s signature.
¶ 10.        
Between February and July 2007, respondent facilitated communication
between complainant and the Burlington attorney.  The Burlington attorney
would send respondent copies of documents related to the case, and respondent
would in turn review them with complainant.  Respondent did not, however,
enter an appearance in the personal injury matter.  Respondent was unable
to estimate the time he spent on the personal injury case between February and
July 2007.  
¶ 11.        
Complainant became dissatisfied with respondent’s services in the
divorce case and terminated his representation in July 2007.  Thereafter,
respondent filed a motion to withdraw in the family court case; no withdrawal
was filed in the personal injury action because respondent had not entered an
appearance in that matter.  No one was hired to take on his communication
role in the personal injury action.  Respondent did not indicate whether
he would seek a fee after he was fired.  Fearing that respondent would do
so, complainant filed a complaint against respondent.
¶ 12.        
Complainant’s case settled for a total of $682,500.  Had respondent
collected his twelve percent contingent fee, he would have been paid $81,900
for facilitating communication between complainant and the Burlington
attorney.  
¶ 13.        
Respondent’s case was heard before a panel of the Professional
Responsibility Board on July 21, 2009.  The panel chair explained that the
hearing was to determine the merits of the charges and that sanctions would be
dealt with in a separate proceeding, if necessary.  See A.O. 9, Rule
11(D)(5)(b) (authorizing panel to bifurcate disciplinary hearing and “consider
evidence relevant to the charged violations separately from evidence relevant
to sanctions”).  At the hearing, disciplinary counsel presented testimony
from respondent, complainant, and the Burlington attorney.  Respondent
also testified on his own behalf and, over the objection of disciplinary
counsel, presented the testimony of seven former and current clients. 
These clients had no knowledge of respondent’s agreement with complainant, but
instead stated their belief that respondent’s fees were fair, well-explained,
in writing, and that respondent represented them well, even if they were not
able to pay his fee.
¶ 14.        
At the close of the evidence, the panel chair stated, “I wanted to know
if counsel wants to address the sanctions criteria or not, just because we
could make use of this time.  I told you I would separate the issues out,
but since we’re wrapping up a little early, I wondered what your prerogatives
were, what your requests would be?”  Disciplinary counsel indicated that
she would file a memorandum on the issue and the only testimony she would
solicit would be respondent’s on the issue of whether he accepted
responsibility for his actions.  Then the following exchange took place
between the chair and respondent:
  [Chair]: 
[Respondent], would you need a hearing with testimony if we got to the
sanctions issue?  Do you want to reserve on that?
 
 
[Respondent]:  May I?
 
 
[Chair]:  Yes.  
 
¶ 15.        
Without further proceedings, the panel issued a decision on April 27,
2010.  The panel concluded that respondent had violated Rule 1.5(c) by
entering a contingent fee agreement without putting it in writing and Rules
8.4(a) and 1.5(a) by attempting to charge an unreasonable fee.  As to sanctions,
the panel concluded that a public reprimand was appropriate.  One panel
member dissented, finding no violations of the disciplinary rules.  The
dissenter concluded that there was insufficient evidence to demonstrate that an
enforceable agreement was reached between the parties.  Because there was
no completed agreement within the meaning of Rule 1.5, the dissenter reasoned
that respondent was not required to reduce the terms of the arrangement to
writing and that there was no attempt to charge an unreasonable fee.  
¶ 16.        
We elected to review this case on our own motion.  A.O. 9, Rule
11(E).  On review, we give deference to the panel’s factual findings and
will affirm those findings unless clearly erroneous.  Id.; see In
re Sinnott, 2004 VT 16, ¶ 10, 176 Vt. 596, 845 A.2d 373 (mem.). 
As to sanctions, we accord the panel’s recommendation deference, but “this
Court renders the ultimate decision.”  Sinnott, 2004 VT 16,
¶ 10.
I.
¶ 17.        
We first address the issue of whether respondent violated Rule 1.5(c) by
failing to put his contingent fee agreement with complainant in writing. 
At the time respondent concluded his agreement with complainant, Vermont Rule
of Professional Conduct 1.5(c) stated:
A contingent fee
agreement shall be in writing and shall state the method by which the
fee is to be determined, including the percentage or percentages that shall
accrue to the lawyer in the event of settlement, trial or appeal, litigation
and other expenses to be deducted from the recovery, and whether such expenses
are to be deducted before or after the contingent fee is calculated.
 
(Emphasis added.)[1]  The rule language is mandatory,
directing that a contingent fee agreement “shall” be in writing, without
exception.  The purpose of the rule is to set forth the parties’
obligations up-front to avoid later confusion or disagreement about the terms
of representation or the fee due.  See V.R.Pr.C. 1.5 cmt. 2 (“A written
statement concerning the terms of the engagement reduces the possibility of
misunderstanding.”).  As another court explained, “one of the principal
purposes of the rules respecting contingency fee agreements is to assure that a
client is fully advised at the time such agreement is executed of all of the
financial obligations that such client is assuming by the establishment of the
attorney client relationship.” Joyce v. Elliott, 857 P.2d 549, 552
(Colo. App. 1993).
¶ 18.        
Respondent does not dispute that he failed to provide complainant with a
written fee agreement,[2]
but argues that it was not required in this case because complainant was
physically unable to sign one.  We find no merit to this argument. 
First, no signature was required.  Although Rule 1.5(c) has since been
revised and now requires that a contingent fee agreement “shall be in a writing
signed by the client,” V.R.Pr.C. 1.5(c) (effective Sept. 1, 2009), there was no
such requirement at the time of respondent’s actions.  Therefore,
respondent should have at the very least given complainant a written document
with the terms of the parties’ arrangement.  Respondent claims that a
writing without the client’s signature would have been unenforceable and
therefore without purpose.  To the contrary, putting the fee agreement in
writing would have served the important purpose of providing necessary details
about respondent’s obligations and therefore reducing the possibility of later
confusion. 
¶ 19.        
Second, even if complainant’s signature was essential, there were
avenues available to obtain some kind of written approval from complainant on a
written fee agreement.  Another individual could have signed on
complainant’s behalf or signed as a witness to complainant’s verbal assent.
 See In re Swartz, 686 P.2d 1236, 1239 (Ariz. 1984) (recounting how
attorney properly established conservatorship and had mother and brother sign
contingent fee agreement on behalf of incapacitated client).  Respondent
himself had signed the Covenant Not to Sue at complainant’s direction and thus
was obviously aware of this option.  Respondent did not explore any of
these possibilities.  Instead, respondent made no effort to reduce his
agreement with complainant to writing.  This action violated Rule 1.5(c). 
See Statewide Grievance Comm. v. Dixon, 772 A.2d 160, 164 (Conn. App.
Ct. 2001) (holding that prior relationship with client did not waive
requirement of having a written agreement in contingent fee matter).
¶ 20.        
Respondent argues that there was no harm in this case because although
he failed to reduce his agreement with complainant to writing, all parties were
clear on the amount of the fee and, in any event, he did not attempt to collect
his fee.  We disagree.  There was much concerning the fee agreement
that was unclear to both respondent and complainant.  The scope of
services respondent was to perform was ill-defined.  In addition, details
such as the manner in which respondent’s expenses were to be allocated and the
fee complainant would owe if the case settled were not arrived upon.  See
V.R.Pr.C. 1.5(c) (requiring writing to set forth percentage of lawyer’s
recovery, how expenses will be allocated, and fee if case settles).  Had
respondent undertaken to put his agreement with complainant in writing, he
would have been forced to address these issues.  Thus, even if we accepted
respondent’s “no harm, no foul” argument, we conclude that it does not apply in
this case.  The purpose of the rule was not fulfilled because the parties
were unclear about the exact terms of the agreement.  Respondent committed
professional misconduct in failing to put the contingent fee agreement in
writing.  See Statewide Grievance Comm. v. Gifford, No.
CV000800490S, 2002 WL 237821, at *2 (Conn. Super. Ct. Jan. 23, 2002) (rejecting
argument that rule not violated when no fee is collected or charged because a
writing “serves the important purpose of documenting that a client does not owe
attorney fees when he has not prevailed in the case”).
II.
¶ 21.        
Next, we turn to the panel’s conclusion that respondent committed
professional misconduct by attempting to charge an unreasonable fee.  This
charge stems from a combination of two professional conduct rules: first, Rule
8.4(a), which states that it is unprofessional conduct for a lawyer to “attempt
to violate the Rules of Professional Conduct”; and second, Rule 1.5(a), which
states that “A lawyer’s fee shall be reasonable.”[3]  In tandem, disciplinary counsel
asserts that a lawyer commits professional misconduct by attempting to charge a
fee that is not reasonable.  According to the panel, respondent’s
agreement to a twelve percent contingent fee for facilitating communication was
such misconduct.
¶ 22.        
The reasonableness of the twelve percent fee depends on many
factors.  Under Rule 1.5(a), these are:
  (1) the time
and labor required, the novelty and difficulty of the questions involved, and
the skill requisite to perform the legal service properly;
  (2) the
likelihood, if apparent to the client, that the acceptance of the particular
employment will preclude other employment by the lawyer;
  (3) the fee
customarily charged in the locality for similar legal services;
  (4) the
amount involved and the results obtained;
  (5) the time
limitations imposed by the client or by the circumstances;
  (6) the
nature and length of the professional relationship with the client;
  (7) the
experience, reputation, and ability of the lawyer or lawyers performing the
services; and
  (8) whether
the fee is fixed or contingent.
 
Applying these factors, the
hearing panel concluded that because complainant’s case required specialized
legal skills and legal experience and contained a high degree of risk of no
recovery, an overall high contingent fee for the legal team in complainant’s
case was not unreasonable.  As related particularly to respondent,
however, the panel concluded that his communication role did not justify such a
large fee.  
¶ 23.        
We discern no clear error in the panel’s finding.  Under the
above-listed factors, respondent’s agreed-upon services provided an
insufficient basis for such a large percentage of complainant’s recovery. 
Respondent’s role did not require a large investment of time or labor.  In
addition, although he is an experienced lawyer, his tasks did not require
specialized legal knowledge or legal experience.  Further, facilitating
communication would not preclude respondent from accepting other
employment.  The fee was excessive compared to the work that respondent
was to perform.[4] 
See Sinnott, 2004 VT 16, ¶¶ 12-13 (concluding that evidence supported
panel’s conclusion that fee was unreasonable because fee was not related to the
routine tasks performed); see also In re Gerard, 548 N.E.2d 1051, 1057
(Ill. 1989) (concluding contingent fee excessive where it involved mostly
nonlegal services); Comm. on Legal Ethics v. Gallaher, 376 S.E.2d 346,
349-50 (W. Va. 1988) (holding that a fifty percent contingent fee was excessive
where lawyer’s role was to review records and draft routine documents to settle
an insurance claim).  
¶ 24.        
Respondent attempts to distinguish his fee from other cases involving
unreasonable fees on the bases that in his case his recovery was not certain,
he performed useful work, and he did not ultimately bill complainant for his
time and therefore caused no harm to his client.  The risk of no recovery
was not enough to justify respondent’s fee.  In addition, we have already
considered the nature of respondent’s work and do not find that it warranted a
significant fee.  Respondent’s role was to facilitate communication. 
No extensive legal work, specialized research, or preparation of legal
documents was required.  We reject respondent’s contention that there was
no violation because he caused no harm to his client.  The extent of harm
caused is a factor to be considered at the sanction phase of our analysis, see infra,
¶ 36, but cannot excuse respondent’s actions.
¶ 25.        
Respondent further argues that the fee was not excessive because he
believed that his role would expand if the case proceeded past summary
judgment.  In support, respondent points to a prior case that he worked on
with the Burlington attorney.  The facts surrounding that collaboration
were very different, however.  In that case, respondent solicited the
Burlington attorney’s help to litigate a slip-and-fall case because the
Burlington attorney had expertise in that area and respondent did not.  The
Burlington attorney took the lead on the case, and respondent gave him a
portion of the fee he had already negotiated with the client.  
¶ 26.        
The circumstances of respondent’s entry into complainant’s case and the
resulting agreement differed greatly from the above facts.  The Burlington
attorney did not solicit respondent’s help because respondent could offer
unique expertise; rather, respondent joined the case at complainant’s request
to fill a role unconnected to any particular legal expertise.  After complainant
hired respondent, he did not alter the Burlington attorney’s
responsibilities.  Further, the Burlington attorney did not have an
agreement with respondent, did not ask for respondent’s assistance, and did not
make any arrangement for respondent to become involved in the merits of the
litigation.  In addition, because respondent’s fee was added onto the
Burlington attorney’s—as opposed to a percentage of the Burlington attorney’s
already negotiated one-third—there was no reasonable basis for respondent to
conclude that he would be assuming any of the Burlington attorney’s
workload.  Moreover, other facts demonstrate the narrow scope of
respondent’s role.  The only matter discussed at the meeting was
respondent’s communication role.  Respondent did not enter an appearance
in the personal injury action, signifying that he did not expect to be filing
any court documents on complainant’s behalf.  Thus, regardless of
respondent’s subjective understanding, at the time he entered the agreement,
there was no objective basis for respondent to think that he would contribute
to the case in any manner other than that specified at the meeting:
facilitating communication between complainant and the Burlington attorney.
¶ 27.        
Respondent also argues that he should not be disciplined because he did
not attempt to collect a fee and the reasonableness of the fee can be measured
only when the litigation has ended.  Respondent contends that only at this
point can an assessment be made of whether an attorney’s remuneration is
commensurate with the work performed.  As related to his own work,
respondent hypothesizes that his role would have expanded once trial
preparation began, and if it did not he could have reduced his fee before
billing complainant.  Respondent contends that because complainant
terminated him, he did not have the opportunity to demonstrate either of these
possibilities and should not be punished for something that did not
occur.  
¶ 28.        
Respondent’s argument reflects a misunderstanding of his obligations
under the rules.  Respondent made a deal to receive twelve percent of
complainant’s recovery, and at the time the only discussed role for respondent
was as a communication facilitator.  Rather than setting a high fee based
on an unvoiced expectation of additional work that might arise and adjusting
the fee downwards if it did not, respondent was required to initially set a fee
which fairly reflected that amount of work he did agree to
perform.  This is the only manner in which a client’s interest can be
protected.  The fee must be set forth in advance so that a client can make
an initial informed decision about the attorney’s representation.  If, at
some point in the future, respondent’s role had enlarged, then he could have
sought additional compensation.  Respondent is held accountable for the
deal he made, not the one he supposed might be made in the future.
¶ 29.        
In addition, it is irrelevant that respondent did not actually bill
complainant for the twelve percent contingent fee.  In contracting with
complainant for twelve percent of complainant’s recovery, respondent attempted
to violate the directive that lawyers charge a reasonable fee set forth in Rule
1.5(a).  This is a violation of Rule 8.4(a).  See Lawyer
Disciplinary Bd. v. Duty, 671 S.E.2d 763, 770 (W. Va. 2008) (concluding
that lawyer’s attempt to withhold $3500 in undocumented expenses violated rules
1.5(a) and 8.4(a) even though amount was not ultimately withheld); Lawyer
Disciplinary Bd. v. Ball, 633 S.E.2d 241, 248 (W. Va. 2006) (concluding
that lawyer violated rules of professional conduct for agreeing to an excessive
fee, even though he did not actually receive the fee).  Therefore, we
conclude that respondent violated rules 1.5(a) and 8.4(a) by attempting to charge
an excessive fee.
III.
¶ 30.        
Having affirmed the violations, we turn to the question of
sanctions.  As a threshold matter, respondent contends that the panel
denied him due process because it indicated that it would bifurcate the
violation and sanction determinations but instead issued a decision on both
without a separate sanctions hearing.  Disciplinary counsel argues that no
additional hearing is warranted because respondent has failed to proffer what
“additional, relevant, substantive testimony,” he would present upon remand.
¶ 31.        
Disciplinary proceedings in Vermont are neither civil nor criminal, but
basic due process rights are accorded to attorneys.  In re Berk,
157 Vt. 524, 528, 602 A.2d 946, 948 (1991).  Thus, an accused attorney has
the right to “be given a full opportunity to explain the circumstances of an
alleged offense and to offer testimony in mitigation regarding any possible
sanction.”  Fla. Bar v. Baker, 810 So. 2d 876, 879 (Fla.
2002).  At the same time, however, “a respondent’s due process rights must
be carefully balanced against the importance of the public interest in
expeditiously resolving complaints of misconduct.”  Disciplinary
Counsel v. Heiland, 2008-Ohio-91, ¶ 32, 880 N.E.2d 467.
¶ 32.        
We conclude that resolution without a remand will not violate
respondent’s due process rights because respondent already presented
significant evidence relative to sanctions and has failed to proffer what
additional noncumulative evidence he would present at a second hearing. 
See Fla. Bar v. Tobkin, 944 So. 2d 219, 226 (Fla. 2006) (holding that
there was no due process violation where respondent was given an opportunity to
“explain the circumstances of the alleged offenses and to offer testimony in
mitigation of any penalty to be imposed”).  Respondent personally
testified concerning mitigating factors such as his willingness to represent
clients who may not have the ability to pay his fee.  In addition,
respondent presented the testimony of seven former or current clients, who had
no knowledge of the charges but were character witnesses for respondent. 
Moreover, in his brief, respondent offers no specific additional evidence that
he would present at a second hearing, and at oral argument, respondent simply
claimed that he would like to provide testimony on sanctions and offer
witnesses to rebut the panel’s finding that he had a selfish motive.  
¶ 33.        
Although we agree with respondent that the panel should have fulfilled
its promise of a bifurcated proceeding, we conclude it is unnecessary to delay
this proceeding further with another hearing on respondent’s service to the
community.  This evidence is cumulative to that previously offered and
would not add anything to our analysis.  See In re Balsamo, 780
A.2d 255, 258 (D.C. 2001) (concluding accused attorney’s due process rights
were not violated by denial of opportunity to present new evidence because it
was not likely that this evidence “would have added substantially to the
evidence already introduced”).  Further, as explained below, the sanction
imposed on respondent is light and cannot be mitigated further in light of the
numerous aggravating factors.  See, infra, ¶ 44.  Therefore,
respondent is not prejudiced by the lack of another hearing.  
¶ 34.        
In its decision, the hearing panel recommended that respondent receive a
public reprimand.  Disciplinary counsel argues that respondent’s actions
were serious and done with a knowing state of mind, and thus warrant a term of
suspension.  Respondent claims that at most he should be privately
admonished because any violation was not done intentionally, and no harm
resulted.  
¶ 35.        
The American Bar Association’s Standards for Imposing Lawyer Sanctions
guide our sanctions determination.  ABA Ctr. for Prof’l Responsibility, Standards
for Imposing Lawyer Sanctions (1986) (amended 1992) [hereinafter ABA
Standards]; see In re Neisner, 2010 VT 102, ¶ 14, __ Vt. __, __
A.3d __ (employing ABA Standards).  Under this construct, we consider:
“(a) the duty violated; (b) the lawyer’s mental state; and (c) the actual or
potential injury caused by the lawyer’s misconduct; and (d) the existence of
aggravating or mitigating factors.”  ABA Standards, supra, § 3.0,
at 26.  Depending on the importance of the duty violated, the level of the
attorney’s culpability, and the extent of the harm caused, the standards
provide a presumptive sanction.  See V.R.Pr.C., Scope (explaining that
severity of sanction “depend[s] on all the circumstances, such as the
willfulness and seriousness of the violation, extenuating factors and whether
there have been previous violations”).  This presumptive sanction can then
be altered depending on the existence of aggravating or mitigating factors. 
In arriving at an ultimate sanction, we are mindful that the purpose of
sanctions is not “to punish attorneys, but rather to protect the public from
harm and to maintain confidence in our legal institutions by deterring future
misconduct.”  In re Hunter, 167 Vt. 219, 226, 704 A.2d 1154, 1158
(1997).
¶ 36.        
In this case, the duty owed is not disputed.  Respondent violated
duties that he owed as a professional—to put a contingent fee agreement in
writing and to charge a reasonable fee for his services.  As for injury,
there was no actual injury to complainant because respondent did not attempt to
collect his fee.  Contrary to respondent’s assertions, however, there was
the potential for injury to complainant had respondent not been dismissed from
the case and billed for his twelve percent fee.  In addition, there was
injury to the public at large and the legal profession because lack of written
contingent agreements and excessive fees feed public distrust of lawyers and
decrease public confidence in the profession.  In re Farrar, 2008
VT 31, ¶ 8, 183 Vt. 592, 949 A.2d 438 (mem.) (considering harm to public
and profession in addressing sanctions); see In re Fasig, 444 N.E.2d
849, 850 (Ind. 1983) (concluding that attorney’s agreement to charge contingent
fee in a criminal matter “demean[ed] the entire legal profession”); see also
V.R.Pr.C., Preamble (explaining that “a lawyer should further the public’s
understanding of and confidence in the rule of law and the justice
system”).  
¶ 37.        
The main area of dispute between the parties is respondent’s mental
state.  The ABA Standards define three levels of culpability for purposes
of sanctions.  The most culpable mental state is intent, which is defined
as acting “with the conscious objective or purpose to accomplish a particular
result.”  ABA Standards, supra, Definitions at 9.
 Knowledge—the next most culpable mental state—is a “conscious awareness
of the nature or attendant circumstances of the conduct but without the
conscious objective or purpose to accomplish a particular result.”  Id.
 Finally, the least culpable mental state is negligence, which is when a
lawyer fails “to heed a substantial risk that circumstances exist or that a
result will follow, which failure is a deviation from the standard of care that
a reasonable lawyer would exercise in the situation.”  Id. 
¶ 38.        
Under these definitions, the distinguishing factor between negligent and
knowing conduct is whether a lawyer had a conscious awareness of the conduct
underlying the violation or whether he failed to heed a substantial risk that a
violation would result from his conduct.  In other words, was the lawyer
aware of the circumstances that formed the basis for the violation?  If
so, the conduct was done knowingly.  If the lawyer instead acted without
awareness, but below the accepted standard of care, then he acted
negligently.  Application of these definitions is fact-dependent.  As
another court observed, “[t]he line between negligent acts and acts with
knowledge can be fine and difficult to discern, yet the difference between the
presumptive sanction of reprimand or suspension is great.”  In re
Stansfield, 187 P.3d 254, 262 (Wash. 2008).  Precisely because this
line is difficult to discern and involves factual determinations, we give
deference to the panel’s assessment of an attorney’s mental state.  See In
re Van Dox, 152 P.3d 1183, 1187 (Ariz. 2007) (“State of mind is a fact
question.”); In re Preszler, 232 P.3d 1118, 1127 (Wash. 2010) (noting
that mental state is a factual question and therefore factfinder’s
determination is given great weight).  
¶ 39.        
In this case, the hearing panel concluded that respondent’s failure to
put his contingent fee in writing was done knowingly, but his attempt to charge
an unreasonable fee was done negligently.  Disciplinary counsel argues
that respondent’s actions were knowing violations of the duties he owed as a
professional in both instances, while respondent claims that at the most his
actions were done negligently because he had no intent to commit any wrongdoing
and no selfish motive.  We consider the violations in turn.  As to
the written agreement, the panel found that respondent’s failure to put the
contingent fee in writing was done knowingly because he was aware of the nature
and circumstances of his actions that formed the basis for the violation. 
In other words, he knew that having a written agreement was a requirement of
the rules and that he did not have one with complainant.  These findings
are supported by the evidence.  See In re Hongisto, 2010 VT 51,
¶¶ 10-11, __ Vt. __, 998 A.2d 1065 (panel’s findings will be affirmed
unless clearly erroneous).  Respondent does not really dispute that he
understood the general obligation to put a contingent fee agreement in
writing.  Respondent had done so in the past using a set form.  His
knowledge of this obligation is further indicated by his request that the
Burlington attorney draft a letter memorializing the agreement with
complainant.  
¶ 40.        
Regarding the second violation, disciplinary counsel argues that
respondent acted knowingly because he knew that his twelve percent fee
agreement was unreasonable and he did it to obtain a substantial personal
benefit.  The panel found differently.  The panel found that respondent
acted negligently because he failed to consider the nature or extent of the
service he was providing in exchange for the fee charged.  The facts
support the panel’s finding that respondent, however erroneously, believed that
he would contribute to a greater degree to complainant’s case.  Because he
was not consciously aware that he would do very little work for a large fee,
his actions were negligent.  Cf. In re Preszler, 232 P.3d at
1127-28 (explaining that attorney knowingly charged excessive fee because he
knew he did very little work for a substantial fee).  
¶ 41.        
It bears emphasizing that this standard is relevant for the mental state
determination relative to sanctions only.  As discussed in the merits
portion of this opinion, supra ¶ 26, respondent’s subjective belief
regarding the extent of services he was to provide cannot excuse the violation
because all of the objective facts demonstrated that respondent’s role was
limited to communication.  In the context of sanctions, however, knowing
conduct does not encompass both knew or should have known.  If the
definition extended to constructive knowledge then “no misconduct would be
negligent because rather than failing to heed a substantial risk we would
always assume the lawyer should have known the substantial risk.”  In
re Stansfield, 187 P.3d at 263.  Thus, while a lawyer’s good faith,
but unreasonable, belief that his actions are not misconduct is not a defense
to a violation, such an error can be a factor in imposing discipline.  See
In re PRB Docket No. 2007-046, 2009 VT 115, ¶ 23, 187 Vt. 35, 989 A.2d
523 (considering that lawyers acted in good faith in arriving at appropriate
discipline); see also La. State Bar Ass’n v. Marinello, 523 So. 2d 838,
842-43 (La. 1988) (noting that ignorance of disciplinary rules is no excuse,
but lack of intent to commit wrongdoing was mitigating factor); N. Moore, Mens
Rea Standards in Lawyer Disciplinary Codes, 23 Geo. J. Legal Ethics 1, 52
(2010) (explaining that lawyer’s mistake of law is not an excuse to disciplinary
violation, but courts consider whether lawyer acted in good faith in fashioning
sanction).  
¶ 42.        
That respondent’s conduct is most appropriately characterized as
negligent in this case is further confirmed by the commentary in the ABA Standards,
which explains that knowing violations generally occur when a lawyer “engages
in a pattern of charging excessive or improper fees.”  ABA Standards, supra,
§ 7.2 cmt., at 47.  The panel found it significant in this case that
respondent’s conduct was an isolated incident and “the evidence does not show a
pattern of excessive fees.”  
¶ 43.        
In sum, respondent knowingly and negligently violated duties owed as a
professional, which resulted in actual injury to the public and potential
injury to the client.  Under the ABA Standards, a knowing violation of a
duty owed as a professional deserves a presumptive sanction of suspension, id.
§ 7.2, at 46, while “[r]eprimand is generally appropriate when a lawyer
negligently engages in conduct that is a violation of a duty owed a
professional, and causes injury or potential injury to a client, the public, or
the legal system.”  Id. § 7.3, at 47.
¶ 44.        
The panel found the following aggravating factors: (1) respondent’s
substantial experience as a lawyer; (2) respondent’s prior discipline for
charging an excessive fee; (3) respondent’s selfish motive; (4) respondent’s
refusal to acknowledge the wrongful nature of his conduct, and (5) the
vulnerability of complainant.  See id. § 9.22, at 50 (listing
aggravating factors).  Of these, the panel concluded that the most
troubling were the vulnerability of complainant because this made him
“particularly dependent,” and respondent’s substantial experience in the
practice of law.  The panel did not give significant weight to
respondent’s prior public censure in 1987 for charging an excessive fee because
this violation was remote.  See id. § 9.32(m), at 51
(recognizing remoteness of prior offense as mitigating factor). 
Respondent challenges some of the aggravating factors, arguing that he had no
selfish motive, and that it is unfair to consider his refusal to acknowledge
the wrongfulness of his conduct because he has a right to defend himself. 
The panel did not enumerate any mitigating factors, but respondent urges us to
consider his reputation of providing representation to clients of limited
financial means.  Id. § 9.32(g), at 51 (listing “character or
reputation” as mitigating factor).  
¶ 45.        
Recalling that the presumptive sanction in this case is either suspension
or reprimand, on balance, we agree with the panel that a reprimand is most
appropriate in this case.  As the ABA Standards state: “Courts typically
impose reprimands when lawyers engage in a single instance of charging an
excessive or improper fee.”  Id. § 7.3, cmt. at 47.  We
agree with the panel that the vulnerability of complainant makes respondent’s
actions particularly egregious, and respondent’s extensive experience in the
practice of law is an aggravating factor.  We also concur that respondent’s
prior discipline bears little on the current sanction given its
remoteness.  As to respondent’s challenge to consideration of his selfish
motive and lack of remorse, we do not reach these arguments because we conclude
that even ignoring these two aggravating factors, the sanction of a public
reprimand is appropriate.  Similarly, even if we considered respondent’s
reputation for conscientious service to clients of limited financial means as a
mitigating factor, this would not outweigh the extensive aggravating
factors.  
¶ 46.        
Finally, we briefly address respondent’s request to reduce the severity
of the sanction imposed against him as a penalty against the hearing panel for
taking more than sixty days to render a decision.  See A.O. 9, Rule 11(D)(5)(c)
(requiring hearing panel to issue case within sixty days of hearing).
 Respondent’s request lacks merit.  The time line in Rule 11 is
directory; there is no enumerated penalty for failure to issue a decision
within sixty days.  Id., Rule 16(I) (explaining that while failure
to abide by timelines “may result in sanctions against the violator,” they are
directory).  Furthermore, no consequence for issuing a late decision is
necessary without demonstration of prejudice, In re Neisner, 2010 VT
102, ¶¶ 28-30, and here, respondent has claimed none.  
Melvin Fink
is publicly reprimanded for violating Rules 1.5(c) and 8.4(a) of the Vermont
Rules of Professional Conduct by failing to put a contingent fee in writing and
attempting to charge an unreasonable fee.  He is placed on probation
pursuant to the terms and conditions set forth in the panel’s decision. 

 

 


 


FOR THE COURT:


 


 


 


 


 


 


 


 


 


 


 


Associate
  Justice

 





[1] 
The rules quoted herein are those that were in effect at the time of
respondent’s conduct, prior to the 2009 amendments.
 


[2] 
Before the panel, respondent agreed that he and complainant had reached an
agreement and he, complainant, and the Burlington attorney all testified that
he was to receive twelve percent of complainant’s recovery.  A dissenting
member of the panel concluded that respondent did not commit professional
misconduct because there was incomplete formation of a contract.  Thus,
the dissenter concluded that respondent had no obligation to put this unformed
contract in writing or to set a reasonable fee.  On appeal, respondent
echoes the dissent, arguing that there was no deal and therefore his conduct
was without reproach.  Because respondent did not make this argument
before the panel, and, in fact, conceded the issue, we do not reach it. 
A.O. 9, Rule 11(E) (“Arguments not advanced before the hearing panel shall not
be presented to the Court, except for good cause shown.”).


[3] 
The rule was amended in 2009 and now states that “[a] lawyer shall not make an
agreement for, charge, or collect an unreasonable fee.”  V.R.Pr.C. 1.5(a)
(effective Sept. 1, 2009).


[4] 
Respondent asserts that the panel’s finding that the fee was excessive was not
supported by clear and convincing evidence because there was no expert
testimony to support it.  Expert testimony is not required in disciplinary
cases.  See Sinnott, 2004 VT 16, ¶ 15 n.3 (expert testimony not
required to meet burden showing that fee was not reasonable); see also In re
Boardman, 2009 VT 42, ¶ 20, 186 Vt. 176, 979 A.2d 1010 (per curiam)
(observing that Judicial Conduct Board does not ordinarily “require expert
evidence to support its findings and conclusions” because it is comprised of
lawyers and lay persons experienced in dealing with legal ethics).  Expert
testimony is necessary only if it helps the trier of fact to “determine a fact
in issue or understand evidence that is outside the expertise or perception of
the fact finder.”  Sinnott, 2004 VT 16, ¶ 15 n.3.  Here, there
was no such need.  The communication service respondent was to perform was
easily understandable.  Further, there was no need for specialized
training to determine that respondent’s fee was disproportionate to this
work.  



