In Re Disciplinary Proceeding Against Kagele

72 P.3d 1067
CourtWashington Supreme Court
DecidedJuly 17, 2003
Docket04851-7
StatusPublished
Cited by51 cases

This text of 72 P.3d 1067 (In Re Disciplinary Proceeding Against Kagele) is published on Counsel Stack Legal Research, covering Washington Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In Re Disciplinary Proceeding Against Kagele, 72 P.3d 1067 (Wash. 2003).

Opinion

72 P.3d 1067 (2003)
149 Wash.2d 793

In the Matter of the DISCIPLINARY PROCEEDING AGAINST Jerry KAGELE, Attorney at Law.

No. 04851-7.

Supreme Court of Washington, En Banc.

Argued March 13, 2003.
Decided July 17, 2003.

*1069 Kurt M. Bulmer, Seattle, for Appellee/Respondent.

Kenneth Wendell Masters, Bainbridge Is., Joanne S. Abelson, Washington State Bar Assc, Seattle, for Petitioner/Appellant.

*1068 MADSEN, J.

Attorney Jerry Kagele appeals the Washington State Bar Association (WSBA) Disciplinary Board's (Board) recommendation that he be suspended from the practice of law for one year with reinstatement conditioned upon full payment of restitution to clients. The Board concluded that Kagele's refusal to return any portion of "fully earned and nonrefundable" retainer fees to clients upon his termination violated Rules of Professional Conduct (RPC) 1.5 and 1.15(d) and that Kagele violated various provisions of the RPCs by neglecting clients' matters, failing to communicate, failing to expedite litigation, failing to adhere to a client's wishes, and failing to act competently in filing a client's complaint. We find that Kagele has not violated RPC 1.5 and 1.15(d) but agree that violations relating to neglect and competency support a one year suspension.

FACTS

Jerry Kagele was admitted to the Washington State Bar on November 16, 1972. At the time of the alleged misconduct, he maintained a practice in Spokane, Washington. Kagele has had no prior disciplinary action.

In 1994, Kagele began offering his clients the option of paying for legal services at an hourly rate or on a flat fee basis. If the client elected to pay a flat fee and the case required more time than Kagele initially anticipated he accepted the additional work as his responsibility. Kagele sought guidance from the WSBA on how to structure his written fee agreements and received verbal guidance. The WSBA advised him to disclose in a written fee agreement that his fees were fully earned and nonrefundable. Kagele's fee agreements contained the following relevant language:

THE UNDERSIGNED Client retains Kagele Law Office, attorneys at law, for legal services regarding: _____ upon the following mutual covenants:

1) The fee is computed on an hourly rate of $ ______ with a minimum fee of $ ______. This fee is for professional services of the undersigned attorney.....

2) Receipt of $ ______ as a retainer is acknowledged. The retainer is considered fully-earned and nonrefundable. This retainer should be applied against the minimum fee for professional services....

Kagele filled in the blanks according to each individual case.

Kagele did not use a trust account in connection with fees received under these agreements. His clients either agreed to pay a fully earned, nonrefundable fee, which he would deposit into his office account, or in the limited number of cases where he agreed to work on an hourly basis, he did not take an advance fee requiring the use of a trust account. If Kagele's representation ended prior to the closure of a case, he would refund the fully earned, nonrefundable retainer if he felt that the client's termination was "justified," such as when clients had buyer's remorse, moved their residence, or changed their mind shortly after signing the agreement. Otherwise, he would not refund any amount of the retainer.

INDIVIDUAL GRIEVANCES

Gary and Mikell Sewell

Gary and Mikell Sewell hired Kagele on May 18, 1995 to bring an action against the contractor who built their home. The Sewell's signed the above fee agreement, specifically stating that Kagele's fee would be $5,000 "to ten days prior to trial." Ex. 1A. In May 1995, the Sewell's paid Kagele $5,000. On August 3, 1995, Kagele filed the complaint *1070 and summons but at that time did not inform the Sewells of the filing. Kagele named the contractor's bonding company in the lawsuit but did not properly serve the defendant and when informed of the improper service took no action to correct service.

In November 1995, the Sewells contacted Kagele about the status of the case, and Kagele informed them that the defendant hired a lawyer and had until November 15, 1995 to answer the complaint. The Sewells contacted Kagele on November 16 to determine the next step, and Kagele told them he would get back to them. He did not. After a May 1996 court date was set, the Sewells continued to contact Kagele every six weeks, but Kagele had no further information.

In the spring of 1996, Kagele contacted Chuck Moore to view the damage to the Sewell home. Mr. Moore viewed the home but did not write a report. Kagele also contacted a witness who was asked to be available for trial, as well as an architect but did not contact the witnesses that Mrs. Sewell provided. Kagele never viewed the home himself.

In July 1996, Kagele informed the clients that they would not go to trial in August and that November was a more realistic court date. Kagele filed a motion for default on July 23, 1996, and the defendant filed its answer on August 6, 1996. On August 15, 1996, Kagele filed a note for trial and certificate of readiness. Throughout this time, the Sewells would call Kagele to find out the status of their case, and Kagele would inform them that he had nothing to report. When the Sewells received a new trial date of November 20, 1996, Kagele did not inform them, and they learned of the date from the clerk's office.

On at least two occasions prior to October 29, the Sewells told Kagele that they wanted a jury trial. Kagele, however, never filed a jury demand and was preparing to go forward with a bench trial. On October 29, the Sewells asked Kagele why he had not filed the jury demand as they requested, and he informed them that they did not need a jury. On October 31, the Sewells wrote to Kagele, terminating his services and requesting the return of their file and the unearned portion of their retainer.

The Sewell's new lawyer inventoried the file and could not locate any discovery, notes of conversations or investigations, expert witness or consultation reports, research, or noted correspondence with the Sewells. Kagele explained that the lack of discovery and other trial preparation was a "strategic" approach. If this was his strategy it was never communicated to the Sewells. Kagele did not return any of the $5,000 retainer to the Sewells because he did not think that his termination was "justified," and he did not provide an accounting of his charges. Decision Papers (DP) at 6.

Lawrence and Hilde Turner

In September 1996, the Turners contacted Joe Schumaker to build a warehouse. Mr. Schumaker, however, failed to complete the warehouse on time, and produced poor workmanship and a leaking warehouse. Mr. Schumaker also charged more than the original quoted price. Town and Country Building Supply (T & C) supplied the lumber and filed a lien against the Turner home when Mr. Schumaker failed to pay the lumber bills. The Turners had already paid Mr. Schumaker for the lumber.

On April 7, 1997, the Turners contacted Kagele by telephone to discuss the matter. They thoroughly explained the situation, including the fact that T & C was very cooperative and willing to testify against Mr. Schumaker. The Turners met with Kagele later that same day for an hour and a half. This was their only meeting with Kagele. At the meeting, the Turners signed the "fully-earned and non-refundable" retainer fee agreement, stating that Kagele's fee was "a total minimum fee of $3,500" exclusive of costs. DP at 7.

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