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ATTORNEY disciplinary proceeding.
Attorney's license revoked.
¶1 PER CURIAM. We review Referee L.
Michael Tobin's report recommending that the
court declare Attorney James T. Runyon in
default and revoke his license to practice
law in Wisconsin for professional
misconduct. The referee also recommends
that Attorney Runyon make restitution to the
Wisconsin Lawyers' Fund for Client
Protection (Fund) and to certain clients.
¶2 No appeal has been filed so we
review the referee's report pursuant to
Supreme Court Rule (SCR) 22.17(2). After
review of the matter, we agree with the
referee that, based on Attorney Runyon's
failure to answer the Office of Lawyer
Regulation's (OLR) complaint, the OLR is
entitled to a default judgment. We further
agree with the referee that revocation of
Attorney Runyon's license is an appropriate
sanction for his professional misconduct.
We agree that Attorney Runyon should be
required to make restitution to the Fund and
certain clients and, finally, we conclude
that he should be assessed the full costs of
this proceeding which are $1,080.34 as of
June 26, 2020.
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¶3 Attorney Runyon was admitted to
practice law in Wisconsin in 1978. His
professional disciplinary history in
Wisconsin consists of:
(a) A one-year suspension in 1984 for
dishonest conduct, consisting of concealing
fees from his law partners, and keeping them
for himself. Attorney Runyon also gave
false testimony at a John Doe proceeding
concerning the withholding of those funds.
In re Disciplinary Proceedings Against
Runyon, 121 Wis. 2d 37, 357 N.W.2d 545
(1984);
(b) A 2006 private reprimand for dishonest
conduct, based on Attorney Runyon entering
into a separate agreement for fees without
the knowledge or consent of his co-counsel
in a products liability case. Private
Reprimand No. 2006-11 (electronic copy
available at
https://compendium.wicourts.gov/app/raw/
001883.html);
(c) A 60-day suspension in 2015 for failing
to hold client funds in trust, converting
client funds to cover disbursements to other
clients, commingling personal funds in his
trust account, and failing to keep necessary
trust account records. In re Disciplinary
Proceedings Against Runyon, 2015 WI 95, 365
Wis. 2d 32, 870 N.W.2d 228; and
(d) A 2017 public reprimand for misconduct
for failing to give one client a written
communication explaining the
representation's scope or required fee
information, failing to notify the client
before removing fees from his trust account,
and agreeing to pay another client's bills
while she was incarcerated, but without
explaining which bills he would pay,
communicating his fee in writing, or
promptly providing the client a complete
accounting upon the close of the
representation. Attorney Runyon also failed
to communicate his fee in writing to another
client, withdrew the client's entire
advanced fee before it was earned, and did
not provide the necessary notice after the
representation ended. Public Reprimand of
James T. Runyon, No. 2017-5 (electronic copy
available at
https://compendium.wicourts.gov/app/raw/
002958.html).
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¶4 Attorney Runyon's law license is
also administratively suspended for failure
to pay state bar dues, failure to comply
with Continuing Legal Education
requirements, and failure to submit the
required trust account certification.
¶5 On September 5, 2018, Attorney
Runyon signed a power of attorney appointing
an attorney-in-fact to assist him in closing
his law practice. On September 6, 2018,
Attorney Runyon filed a petition seeking to
voluntarily resign his Wisconsin law
license, then filed an amended petition
asking the court to suspend his law license
immediately and indefinitely due to an
unexplained medical incapacity. On October
9, 2018, this court temporarily suspended
Attorney Runyon's Wisconsin law license for
non-cooperation with the OLR, held Attorney
Runyon's petition to voluntarily resign in
abeyance, and denied his medical incapacity
petition as premature. His law license
remains subject to the temporary suspension
for noncooperation.
¶6 On June 26, 2019, the OLR filed a
disciplinary complaint against Attorney
Runyon alleging that he committed 23 counts
of professional misconduct in four client
matters, and asking the court to revoke his
law license and order restitution. Attorney
Runyon was personally served with the
complaint and order to answer on June 28,
2019. Referee James Erickson was appointed.
¶7 Attorney Runyon failed to respond to
the OLR's complaint. On October 4, 2019,
the OLR filed a notice of motion and motion
for default judgment, serving it upon
Attorney Runyon at his last known addresses.
Attorney Runyon failed to file any written
response to the motion and the OLR renewed
its motion on January 21, 2020.
¶8 Referee Erickson withdrew from the
case and Referee L. Michael Tobin was
appointed on March 16, 2020. On April 21,
2020, Referee Tobin notified Attorney Runyon
and counsel for the OLR by email of a
scheduling conference and hearing on the
default motion to be held on April 30, 2020.
Attorney Runyon failed to appear or
participate.
¶9 On May 21, 2020, the referee issued
a report recommending that this court grant
the OLR's motion for default judgment, based
upon Attorney Runyon's failure to file an
answer or appear in the proceeding. The
referee found that the factual allegations
of the OLR's complaint should be taken as
true and proven by clear, satisfactory, and
convincing evidence. The referee recommended
revocation of Attorney Runyon's Wisconsin
law license and the imposition of
restitution as set forth herein.
¶10 On May 29, 2020, the OLR filed a
restitution statement confirming its request
for the restitution, as recommended by the
referee. Attorney Runyon did not respond to
the OLR's restitution statement.
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¶11 Attorney Runyon did not appeal from
the referee's report and recommendation, so
we proceed with our review of the matter
pursuant to SCR 22.17(2). We review a
referee's findings of fact subject to the
clearly erroneous standard. In re
Disciplinary Proceedings Against Inglimo,
2007 WI 126, ¶5, 305 Wis. 2d 71, 740 N.W.2d
125. We review the referee's conclusions of
law de novo. Id. We determine the
appropriate level of discipline independent
of the referee's recommendation. In re
Disciplinary Proceedings Against Widule,
2003 WI 34, ¶44, 261 Wis. 2d 45, 660 N.W.2d
686.
¶12 We agree with the referee that
Attorney Runyon should be declared in
default. In addition, the referee properly
relied on the allegations of the complaint,
which were deemed admitted by Attorney
Runyon's failure to answer. We therefore
agree with the referee that the factual
allegations of the OLR's complaint may be
taken as true and they prove by clear,
satisfactory, and convincing evidence that
Attorney Runyon committed all of the counts
of misconduct alleged in the complaint.
¶13 With respect to the appropriate
level of discipline, upon careful review of
the matter, we agree with the referee's
recommendation for revocation of Attorney
Runyon's license to practice law in
Wisconsin and the imposition of restitution.
We will merely summarize the allegations of
misconduct for each separate client matter.
Matter of A.D. and T.D. (Counts 1-
5)
¶14 In October 2017, Attorney Runyon was
retained by two brothers, A.D. and T.D., to
sell real estate held by the testamentary
trust of their late mother. The property
was sold and proceeds of the sale were to be
divided between the brothers. On December
22, 2017, a title company sent Attorney
Runyon a check for $135,785.42, payable to
the P.A.T. Trust, representing the proceeds
from the sale of the property. Over the
next six months Attorney Runyon proceeded to
empty this fund for his own benefit, while
misrepresenting the status of the matter to
his clients. By July 9, 2018, Attorney
Runyon's trust account held only $48.35
attributable to the P.A.T. Trust. Around
the same time, Attorney Runyon mailed his
clients a brochure from the Fund and a copy
of the check from the real estate sale,
indicating they could try to recover their
funds from the Fund. He then failed to
respond to the OLR's requests for
information about the grievance that ensued.
Matter of S.S. (Counts 6-10)
¶15 In October 2017, Attorney Runyon was
retained by G.G. to represent S.S., a minor,
regarding possible criminal allegations.
Attorney Runyon was paid $10,000 in advanced
fees but did not provide his clients with a
written fee agreement. Attorney Runyon
deposited the $10,000 in advanced fees into
his trust account then proceeded to disburse
the funds for his own use. Later that
month, the Lincoln County District
Attorney's Office closed its matter
involving S.S. without filing charges. After
some delay, Attorney Runyon told the clients
he would return the advanced fee by August
11, 2018. He failed to do so. Instead, he
sent the clients a handwritten letter
suggesting they seek reimbursement from the
Fund. The Fund eventually reimbursed G.G.
for the fees paid on behalf of S.S.
Matter of M.B. (Counts 11-18)
¶16 In November of 2017, M.B. hired
Attorney Runyon to recover $1,788.30 in
erroneous fees incurred from Associated
Bank. She paid Attorney Runyon a flat fee
of $500 to commence a small claims action
against Associated Bank. Attorney Runyon
did not give her any written communication
regarding the fee. Attorney Runyon did file
a small claims action against Associated
Bank and the parties settled the matter for
$1,788.30 in exchange for dismissing the
case. However, Attorney Runyon did not
notify the court of the settlement, and it
eventually issued a default judgment against
Associated Bank. He then deposited the
settlement check into his client trust
account without informing his client that he
had received the settlement. He then
proceeded to disburse most of the settlement
funds for his own purposes, while falsely
telling his client that he had not yet
received the settlement funds.
¶17 On February 6, 2018, Attorney Runyon
told the client that the client could pick
up a settlement check at Attorney Runyon's
law office. When the client went to
Attorney Runyon's office the next day,
Attorney Runyon offered a check for $1,000,
which the client declined, asking for the
full settlement, consistent with the initial
agreement.
¶18 The client commenced a small claims
action against Attorney Runyon, who filed an
answer claiming that M.B. owed him fees of
$1,150 plus costs in her case. He attached
a false itemized statement in support of
this misrepresentation. He also failed to
fully cooperate with the OLR's investigation
into this matter.
¶19 In August 2018, a court trial was
conducted in M.B.'s small claims case
against Attorney Runyon. At the trial,
Attorney Runyon testified that he had not
received the settlement funds by early
January of 2018, and that he was owed an
hourly fee. The court rejected Attorney
Runyon's arguments and granted judgment
against him for $1,612.89, reflecting the
Associated Bank settlement amount, less
filing, service, and other costs. Attorney
Runyon never satisfied the judgment. The
Fund eventually reimbursed M.B.
Matter of R.G. (Counts 19-23)
¶20 In late July 2018, Attorney Runyon
retained counsel to assist him with closing
his practice. Nonetheless, on August 7,
2018, Attorney Runyon accepted
representation of R.G. to negotiate a debt
she owed. She paid Attorney Runyon $1,835
in advance. Attorney Runyon did not provide
her with a written fee agreement and did not
deposit the fees into his trust account. On
or around September 24, 2018, Attorney
Runyon falsely told R.G. that he was working
on her matter. R.G. tried contacting
Attorney Runyon after that date, but his
phone number had been disconnected.
Attorney Runyon has not refunded any of
R.G.'s advanced payment. The Fund
eventually reimbursed R.G.
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¶21 The referee concluded that the OLR's
complaint demonstrates that Attorney Runyon
committed the 23 counts of misconduct, as
alleged, involving four separate clients.
In so doing, Attorney Runyon committed eight
counts of misconduct in violation of SCR
20:8.4(c) (Counts 2, 4, 7, 9, 14, 15, 19,
and 22). He made a false statement to a
tribunal in violation of SCR 20:3.3(a)(l)
(Count 17). He engaged in multiple trust
account violations, violating SCR 20:1.15(b)
(1) (Counts 3, 13), SCR 20:1.15(e)(1)
(Counts 1 and 12), and SCR 20:1.16(d)
(Counts 10, 23). He violated rules
pertaining to fee agreements, including SCR
20:1.5(a) (Count 16), SCR 20:1.5 (b)(1) and
(2) (Counts 6, 20), SCR 20:1.5(f) (Count
21), and SCR 20:1.5(h)(1) (Counts 8 and 11).
In addition, for failing to cooperate with
aspects of the disciplinary proceeding,
Attorney Runyon violated SCR 22.03(2),
enforceable via SCR 20:8.4(h) (Count 5) and
SCR 22.03(6), enforceable via SCR 20:8.4(h)
(Count 18).
¶22 With respect to his recommendation
that we revoke Attorney Runyon's law
license, the referee found instructive In
re Disciplinary Proceedings Against
Grogan, 2014 WI 39, 354 Wis. 2d 659, 847
N.W.2d 817. Attorney Grogan, like Attorney
Runyon, had a prior disciplinary history.
This court revoked his law license for
misappropriating the funds of several
clients; lack of diligence; for engaging in
dishonest and fraudulent practices in
multiple matters; and for failing to
cooperate with the OLR's investigations into
his misconduct.
¶23 We adopt the referee's findings and
conclusions and we declare Attorney Runyon
in default and we revoke his law license and
impose the restitution, as recommended. The
facts detailed in the complaint demonstrate
a clear pattern of misconduct by Attorney
Runyon and disregard for his obligations as
an attorney in this state. He converted
thousands of dollars he had obtained from
the clients or their relatives for his own
use and failed to respond to the numerous
grievances filed by his clients. The severe
sanction of the revocation of his license to
practice law in Wisconsin must be imposed to
protect the public from a repetition of this
misconduct and to deter other attorneys from
engaging in similar misconduct. We further
agree with the referee that Attorney Runyon
must be held responsible for the $135,785.42
he owes to the P.A.T. Trust and for the
amounts that the Fund had to pay to the
clients harmed by his misconduct. We
further conclude that he shall bear the full
costs of this disciplinary proceeding.
¶24 IT IS ORDERED that the license of
James T. Runyon to practice law in Wisconsin
is revoked, effective the date of this
order.
¶25 IT IS FURTHER ORDERED that within 60
days of the date of this order, James T.
Runyon shall pay restitution of $135,785.42
to the P.A.T. Trust.
¶26 IT IS FURTHER ORDERED that within 60
days of the date of this order, James T.
Runyon shall pay restitution to the
Wisconsin Lawyers' Fund for Client
Protection in the amount of $10,000 for the
claims of S.S. and G.G.; $1,612.89 for
M.B.'s claim; and $1,835 for R.G.'s claim.
¶27 IT IS FURTHER ORDERED that within 60
days of the date of this order, James T.
Runyon shall pay to the Office of Lawyer
Regulation the costs of this proceeding,
which are $1,080.34 as of June 26, 2020.
¶28 IT IS FURTHER ORDERED that payment
of restitution is to be completed prior to
paying costs to the Office of Lawyer
Regulation.
¶29 IT IS FURTHER ORDERED that James T.
Runyon shall comply, if he has not already
done so, with the requirements of SCR 22.26
pertaining to the duties of a person whose
license to practice law in Wisconsin has
been revoked.
¶30 IT IS FURTHER ORDERED that James T.
Runyon's petition for voluntary resignation
of his law license, which was held in
abeyance pending consideration of this
disciplinary proceeding, is dismissed as
moot.
¶31 ANN WALSH BRADLEY, J., did not
participate.
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