Office of Lawyer Regulation v. Terry L. Constant

2022 WI 78

• Court: Wisconsin Supreme Court
• Decided: November 23, 2022
• Docket: 2021AP000033-D
• Status: Published

Opinion

2022 WI 78

SUPREME COURT OF WISCONSIN CASE NO.: 2021AP33-D

COMPLETE TITLE: In the Matter of Disciplinary Proceedings Against Terry L. Constant, Attorney at Law:

Office of Lawyer Regulation, Complainant, v. Terry L. Constant, Respondent.

DISCIPLINARY PROCEEDINGS AGAINST CONSTANT

OPINION FILED: November 23, 2022 SUBMITTED ON BRIEFS: ORAL ARGUMENT:

SOURCE OF APPEAL: COURT: COUNTY: JUDGE:

JUSTICES: Per curiam. ZIEGLER, C.J., filed a concurring opinion in which REBECCA GRASSL BRADLEY, HAGEDORN, and KAROFSKY, JJ., joined. NOT PARTICIPATING:

ATTORNEYS: 2022 WI 78 NOTICE This opinion is subject to further editing and modification. The final version will appear in the bound volume of the official reports. No. 2021AP33-D

STATE OF WISCONSIN : IN SUPREME COURT

In the Matter of Disciplinary Proceedings Against Terry L. Constant, Attorney at Law:

Office of Lawyer Regulation, FILED Complainant, NOV 23, 2022 v. Sheila T. Reiff Clerk of Supreme Court Terry L. Constant,

Respondent.

ATTORNEY disciplinary proceeding. Attorney's license

revoked.

¶1 PER CURIAM. We review Referee Charles H. Barr's

report recommending that the court declare Attorney Terry L.

Constant in default and revoke his license to practice law in

Wisconsin for 13 counts of professional misconduct. The referee

also recommends that Attorney Constant make restitution to the

Wisconsin Lawyers' Fund for Client protection (the Fund) and to

certain clients and that Attorney Constant pay the full costs associated with this proceeding. No. 2021AP33-D

¶2 No appeal has been filed so we review the referee's

report pursuant to Supreme Court Rule (SCR) 22.17(2).1 After

careful review of the matter, we agree with the referee that,

based on Attorney Constant's failure to answer the Office of

Lawyer Regulation's (OLR) complaint or otherwise appear in the

proceeding, Attorney Constant is in default. We conclude that

revocation of Attorney Constant's license is an appropriate

sanction for his professional misconduct. We agree that

Attorney Constant 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

total $4,135.06 as of June 20, 2022.

¶3 Attorney Constant was admitted to practice law in

Wisconsin in 1968. His professional disciplinary history

consists of a six-month suspension of his license to practice

law in 2020. In re Disciplinary Proceedings Against Constant,

2020 WI 4, 390 Wis. 2d 1, 937 N.W.2d 599 (Constant I). That

case involved nine counts of misconduct involving numerous trust

1 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.

2 No. 2021AP33-D

account violations, conversion, co-mingling of funds, and

mishandling a personal injury settlement. Id., ¶24.2

¶4 On January 7, 2021, the OLR filed a complaint against

Attorney Constant alleging 13 counts of attorney misconduct

relating to three clients, S.C., M.R., and S.R., between 2014

and 2020, along with an order to answer. Referee Charles H.

Barr was appointed on March 22, 2021. On March 1, 2021,

Attorney Constant filed a verified Petition to Voluntarily

Surrender a Wisconsin License, in which he stated that he

"cannot successfully defend" against the grievances pending

against him and that he wished to surrender his license

"permanently."3

¶5 The OLR made multiple failed attempts at personal

service at Attorney Constant's Kenosha address on file with the

State Bar of Wisconsin (State Bar). On March 9, 2021, the OLR

While not referenced in the complaint or the referee's 2

report, we take judicial notice that the State Bar's records indicate that Attorney Constant's law license currently is administratively suspended for failure to pay mandatory bar dues and for failure to file required trust account certification. Additionally, Attorney Constant did not petition for reinstatement following his six-month suspension by this court in Constant I.

SCR 10.03(7)(a) allows an attorney to file a petition to 3

surrender his or her license to practice law with the State Bar and this court. However, voluntary surrender of a law license is not appropriate in response to a pending disciplinary matter. In re Voluntary Resignation of Robinson, 2010 WI 37, 323 Wis. 2d 727, 729, 782 N.W.2d 98. To the extent that Attorney Constant intended to file a petition for consensual license revocation under SCR 22.19, he did not follow the proper procedure for doing so. See SCR 22.19(3)-(4).

3 No. 2021AP33-D

sent the complaint by certified mail to that address, and

tracking information indicated that it was delivered in

Henderson, Nevada. The referee ultimately concluded that

substitute service was accomplished on March 16, 2021, and

Attorney Constant's answer was due April 5, 2021. Attorney

Constant did not file an answer.

¶6 Attorney Constant failed to appear for a telephonic

scheduling conference on April 22, 2021, at which time the OLR

informed the referee that Attorney Constant's wife indicated a

health issue prevented his attendance. Attorney Constant failed

to appear for a subsequent scheduling conference, and the OLR

again informed the referee that Attorney Constant's wife stated

medical issues prevented his participation. The referee ordered

Attorney Constant to execute medical releases so the OLR could

determine if he had a medical incapacity that made defense of

the proceeding impossible. See SCR 22.16(4)(a). Attorney

Constant returned medical releases to the OLR. The OLR obtained

some of Attorney Constant's medical records but ultimately advised the referee that the OLR could not reach a conclusion on

whether Attorney Constant had a medical incapacity.

¶7 The OLR indicated its intent to file a motion for

default and invited Attorney Constant to provide further

information to support any claim of medical incapacity.

Attorney Constant did not respond and did not assert a medical

incapacity defense.

¶8 The OLR filed a motion for default on February 21, 2022, along with an affidavit showing proof of substitute 4 No. 2021AP33-D

service. On March 1, 2022, the referee issued an order

concluding that "justice is best served by providing Respondent

an additional and final opportunity to assert his incapacity

claim as a matter of record in response to the motion for

default." He therefore ordered that Attorney Constant had 30

days to file a response to the motion for default, "in which he

may allege incapacity and any other reason why the motion should

not be granted." No response was filed.

¶9 Following a hearing, the referee issued an order

recommending that this court find Attorney Constant in default

and that the factual allegations in the complaint be accepted as

true. The order also concluded Attorney Constant had been

properly served, recited several facts indicating that Attorney

Constant had actual notice of the proceeding, and noted that he

had been copied on notices of all hearings, orders, and

correspondence. The referee also ordered the OLR to submit a

brief as to the appropriate level of discipline and allowed

Attorney Constant to do the same. ¶10 The OLR filed a brief advocating that that the referee

recommend that this court should revoke Attorney Constant's

license to practice law and that he be ordered to pay

restitution. Attorney Constant did not file a response.

¶11 On May 31, 2022, the referee issued a report and

recommendation with findings of fact and conclusions of law as

to default and the underlying misconduct allegations. As to

default, the referee found that the OLR unsuccessfully attempted personal service on Attorney Constant at his State Bar address 5 No. 2021AP33-D

in Kenosha on five different dates and thereafter mailed a

certified copy of the complaint, which was ultimately delivered

to an address in Henderson, Nevada. Attorney Constant filed a

signed and notarized petition to voluntarily surrender his law

license, in which he indicated his residence was a P.O. Box in

Henderson, Nevada. Attorney Constant left a voicemail with the

OLR's counsel early in the proceeding "in which Attorney

Constant referred to service on him of documents in the

proceeding." Attorney Constant's wife had multiple

communications with counsel for the OLR acknowledging awareness

of the proceeding and she provided a residential address in

Henderson, Nevada, to the OLR. All of the referee's written

communications with the OLR's counsel, as well as all notices

and orders, were copied to Attorney Constant at the e-mail

address on file for him with the State Bar, and none of them

bounced back. The March 1, 2022 order allowing Attorney

Constant to oppose the motion for default and assert a medical

incapacity defense was mailed to the Henderson, Nevada address that Attorney Constant's wife provided, in addition to being

mailed to the address in Kenosha and e-mailed. Counsel for the

OLR also e-mailed a copy of the order to Attorney Constant's

wife in response to an e-mail from her. The referee found that

these facts constituted "substantial indicia of Attorney

Constant's awareness of this proceeding throughout its

pendency."

¶12 Based on these findings, the referee concluded that Attorney Constant was properly served with the complaint, failed 6 No. 2021AP33-D

to timely file an answer or otherwise appear in the proceeding,

and therefore was in default. The referee further concluded

that neither Attorney Constant nor anyone on his behalf claimed

as a matter of record that he possessed a medical incapacity

that made defense of the proceeding impossible. The referee

further concluded that it was "implausible" that Attorney

Constant could not have done so if he intended to pursue such a

claim based on his filing of a petition to surrender his law

license during the same time period. Accordingly, the referee

recommended that this court find Attorney Constant in default.

¶13 Having concluded that Attorney Constant was in default

for failing to answer, the referee adopted and accepted the

salient factual allegations of the complaint. Those allegations

are summarized as follows.

¶14 In 2011, S.C. hired Attorney Constant to represent her

in a personal injury action after a January 2011 car accident

(first accident). Attorney Constant settled the case and

provided no further services relating to the matter after April 15, 2015, but retained $3,756.86 in his trust account. However,

by April 10, 2016, his trust account held only $34.21 pertaining

to the first accident.

¶15 On April 15, 2015, S.C. was involved in another car

accident and hired Attorney Constant to represent her (second

accident). Attorney Constant was entitled to one-third of any

recovery, plus reimbursements of costs.

¶16 On January 31, 2018, Attorney Constant received a partial insurance payment for S.C.'s medical payments (medpay) 7 No. 2021AP33-D

claim in the second accident in the amount of $1,205.89.

Attorney Constant deposited the check into his trust account on

February 7, 2018, and disbursed $401.96 (one-third) of that

amount to himself. The same day, he issued another check from

the trust account to himself for $800, which indicated it was

for legal fees relating to the first accident. The following

day, he wrote another trust account check payable to himself for

$700, again indicating it was for legal fees relating to the

first accident. These withdrawals extinguished S.C.'s balance

in Attorney Constant's trust account. In the next two months,

Attorney Constant disbursed seven more checks from his trust

account to himself, totaling $4,900, which he indicated were for

legal fees from S.C.'s first accident.

¶17 On April 10, 2018, Attorney Constant deposited an

insurance settlement check for $50,000 for S.C.'s second

accident. He orally notified S.C. of the check, but told her he

could not disburse any settlement funds to her until all claims

had been settled and her medical bills were paid. Over the next 16 months, Attorney Constant repeated these representations to

S.C.

¶18 On or about the same day that Attorney Constant

received the $50,000 settlement check, he disbursed $200 to

himself, indicating it was for legal fees relating to the first

accident. He also wrote two additional checks to himself

disbursing one-third of the settlement ($16,666.66) from the

second accident. Over the next six months, Attorney Constant disbursed 41 checks to himself from his trust account totaling 8 No. 2021AP33-D

$33,200, purportedly as legal fees relating to S.C.'s first

accident. As a result, Attorney Constant held only $271.25 from

the $50,000 settlement check in trust. He later wrote another

check to himself for $1,000, purportedly for fees relating to

the first accident and matters unrelated to S.C.

¶19 Between December 12, 2018 and February 12, 2019,

Attorney Constant received 42 medpay checks totaling $32,462.43

relating to S.C.'s second accident. Attorney Constant orally

told S.C. he had received some medpay checks, but he did not

notify her in writing of his receipt of each and again

represented that he could not disburse any funds to S.C. until

all medpay claims were satisfied. Attorney Constant paid only

$122.27 in medpay claims and disbursed the remainder to himself,

purportedly as fees for other matters.

¶20 On August 2, 2019, Attorney Constant received another

insurance check for $17,500 relating to the second accident.

Before depositing this amount, Attorney Constant should have

been holding $53,356.64 in trust for S.C., but had a balance of only $1,762.70. Attorney Constant deposited the $17,500 check,

which he later disbursed to S.C. at the same time he gave her a

promissory note for $47,557.30 for the remainder of the

settlement.4 At that time, S.C. had outstanding medical bills

from the second accident, but Attorney Constant made no further

4 The OLR's brief regarding sanctions indicates that after the complaint was filed, "the Wisconsin Lawyers' Fund for Client Protection (Fund) fully paid a claim filed by [S.C.]"

9 No. 2021AP33-D

payments to S.C. or on her behalf, and he failed to make any

payments on the promissory note.

¶21 As a result of these allegations, the OLR claimed

Attorney Constant engaged in four counts of attorney misconduct.

The OLR alleged that Attorney Constant: violated SCR

20:1.15(d)(1)5 by failing to give written notice of funds (Count

1); violated SCR 20:1.15(b)(1)6 by failing to hold and safeguard

settlement funds (Count 2); violated SCR 20:1.37 by failing to

act with reasonable diligence to pay S.C.'s medical providers

5Effective July 1, 2016, substantial changes were made to Supreme Court Rule 20:1.15, the "trust account rule." See S. Ct. Order 14-07, 2016 WI 21 (issued Apr. 4, 2016, eff. July 1, 2016). Former SCR 20:1.15(d)(1) was renumbered as SCR 20:1.15(e)(1). The text of the rule was not changed and provides:

Upon receiving funds or other property in which a client has an interest, or in which a 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. 6 SCR 20:1.15(b)(1) 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 or more identifiable trust accounts. 7SCR 20:1.3 provides: "A lawyer shall act with reasonable diligence and promptness in representing a client."

10 No. 2021AP33-D

(Count 3); and violated SCR 20:8.4(c)8 by converting client trust

funds (Count 4).

¶22 In a different matter, on August 17, 2016, M.R. and

S.R. were in a car accident and hired Attorney Constant to

represent them. Under their agreement, Attorney Constant would

be entitled to one-third of their recovery as a legal fee. The

statute of limitations on M.R.'s and S.R.'s claims expired on

August 17, 2019.

¶23 In April 2017, Attorney Constant received and

deposited an insurance check settling M.R.'s claims against one

insurer for $6,850. Attorney Constant later disbursed $2,975.97

to M.R., paid $1,365 to satisfy a medical lien, and disbursed

$2,488.35 to himself. Despite still holding $20.68 in trust for

M.R., Attorney Constant told M.R. that he had disbursed the

entirety of the settlement.

¶24 In February 2018, Attorney Constant received $9,161.60

from an insurer in partial payment of S.R.'s medpay claims and

deposited the same into his trust account. He did not notify S.R. of this payment, but paid some of her medical expenses,

disbursed $2,980 to her, and paid $3,053.56 to himself for his

one-third fee. By November 2018, Attorney Constant's trust

account held only $544.83 relating to S.R., and he told her he

could not disburse the remaining medpay funds due to outstanding

liens. However, between February 2019 and August 2019, Attorney

SCR 20:8.4(c) provides: 8 "It is professional misconduct for a lawyer to engage in conduct involving dishonesty, fraud, deceit or misrepresentation."

11 No. 2021AP33-D

Constant disbursed an additional $19,250 in trust funds to

himself purportedly for fees relating to S.R.

¶25 In early August 2019, an insurer offered to settle

S.R.'s claims for $4,348.40; Attorney Constant forwarded the

offer to S.R. S.R. never authorized the settlement, but

Attorney Constant agreed to settle her claims for $4,400.

Attorney Constant received the funds, deposited them into his

trust account, but did not notify S.R. Attorney Constant

disbursed $300 of the settlement funds to himself, and never

disbursed any to S.R.

¶26 Attorney Constant never provided S.R. or M.R. with an

accounting of the funds he received or paid out on their behalf.

In September 2019, Attorney Constant prepared to close his law

office, but did not inform S.R. or M.R., arrange for successor

counsel, or otherwise communicate with them. When Attorney

Constant closed his office on or about September 30, 2019, he

had not resolved all of S.R.'s outstanding liens or disbursed

the remainder of her settlement funds. In November 2019, S.R. and M.R. discovered that the statute of limitations on their

claims had expired and attempted to contact Attorney Constant by

phone and e-mail, but his phone was disconnected and he did not

respond to their e-mails. Attorney Constant also did not

respond to further inquiries in January 2020 about the status of

S.R.'s claims and settlement.

¶27 On January 28, 2020, in Constant I, this court

suspended Attorney Constant's license to practice law in Wisconsin for six months, effective March 10, 2020. 12 No. 2021AP33-D

Nonetheless, in February and March 2020, Attorney Constant

attempted to negotiate one of S.R.'s outstanding medical bills

and attempted to negotiate a settlement with S.R's and M.R.'s

former landlord. On April 15, 2020, Attorney Constant sent a

proposed settlement to the landlord along with a check drawn

from his trust account for $500. In April and May 2020, S.R.

and M.R. repeatedly asked Attorney Constant to pay the remainder

of S.R.'s settlement funds. He did not do so.

¶28 Based on these allegations, the OLR claimed that

Attorney Constant engaged in nine counts of misconduct. The OLR

claimed that Attorney Constant: violated SCR 20:1.15(d)(1) by

failing to provide prompt notice of receipt of settlement funds

and deliver them to S.R. (Count 5); violated SCR 20:1.4(a)(3)9 by

failing to provide S.R. and M.R. with information necessary to

understand their settlements and the status of their claims

(Count 6); violated SCR 20:1.2(a)10 by failing to obtain S.R.'s

9 SCR 20:1.4(a)(3) provides: "A lawyer shall keep the client reasonably informed about the status of the matter." 10 SCR 20:1.2(a) provides:

Subject to pars. (c) and (d), a lawyer shall abide by a client's decisions concerning the objectives of representation and, as required by SCR 20:1.4, shall consult with the client as to the means by which they are to be pursued. A lawyer may take such action on behalf of the client as is impliedly authorized to carry out the representation. A lawyer shall abide by a client's decision whether to settle a matter. In a criminal case or any proceeding that could result in deprivation of liberty, the lawyer shall abide by the client's decision, after consultation with the lawyer, as to a plea to be 13 No. 2021AP33-D

authorization to settle her claims before accepting a settlement

(Count 7); violated SCR 20:1.15(b)(1) by failing to safeguard

settlement funds belonging to S.R., M.R., and third parties

(Count 8); violated SCR 20:8.4(c) by converting settlement funds

for his own use (Count 9); violated SCR 20:8.4(c) by

misrepresenting that numerous disbursements from his trust

account were related to his representation of S.R. (Count 10);

violated SCR 20:1.4(a)(4)11 by failing to respond to S.R.'s and

M.R.'s requests for information (Count 11); violated SCR

20:1.16(d)12 by failing to inform S.R. and M.R. that he closed

his law office and had terminated his representation or

otherwise intended to take no further action on their behalf

(Count 12); and violated SCR 22.26(2),13 enforceable via SCR

entered, whether to waive jury trial and whether the client will testify.

SCR 20:1.4(a)(4) provides: 11 "A lawyer shall promptly comply with reasonable requests by the client for information." 12 SCR 20:1.16(d) provides:

Upon termination of representation, a lawyer shall take steps to the extent reasonably practicable to protect a client's interests, such as giving reasonable notice to the client, allowing time for employment of other counsel, surrendering papers and property to which the client is entitled and refunding any advance payment of fee or expense that has not been earned or incurred. The lawyer may retain papers relating to the client to the extent permitted by other law. 13 SCR 22.26(2) provides:

An attorney whose license to practice law is suspended or revoked or who is suspended from the practice of law may not engage in this state in the 14 No. 2021AP33-D

20:8.4(f),14 by practicing law in Wisconsin at a time when his

license was suspended (Count 13).

¶29 The referee concluded that Attorney Constant violated

each provision as alleged. The referee then addressed the

proper sanction for Attorney Constant's violations, "focus[ing]

principally on the conduct that directly and most tangibly

injured his clients——namely, his conversion to his own use of

funds that he had a duty to hold in trust for distribution to

those clients or for their benefit."

¶30 The referee noted that the OLR advocated for

revocation of Attorney Constant's license based on principles of

progressive discipline articulated in ABA Standards for Imposing

Lawyer Sanctions, this court's decision in Constant I, and

various prior disciplinary cases. The OLR noted that in

Constant I, this court suspended Attorney Constant's license to

practice law for six months based on nine counts of misconduct

involving systemic trust account problems, conversion, and

mishandling an injury settlement. The referee concluded that a comparison of the conduct in the two cases "unquestionably

practice of law or in any law work activity customarily done by law students, law clerks, or other paralegal personnel, except that the attorney may engage in law related work in this state for a commercial employer itself not engaged in the practice of law.

SCR 20:8.4(f) provides: 14 "It is professional misconduct for a lawyer to violate a statute, supreme court rule, supreme court order or supreme court decision regulating the conduct of lawyers."

15 No. 2021AP33-D

establishes a pattern of similar misconduct with regard to funds

held, or that should have been held, in trust for the benefit of

clients" and that the facts underlying the violations in

Constant I "poignantly illustrate that the trust account

misconduct involved in this case was a continuation of a pattern

of misconduct" from the prior case. The referee concluded that

progressive discipline was appropriate even though most of the

conduct in the present case occurred before this court's

decision in Constant I. He concluded that this case called for

a sanction that was "substantially more severe" because all of

the clients and lienholders in Constant I were eventually paid

whereas here, Attorney Constant's clients and lienholders lost

"over $53,000 in the aggregate."

¶31 In assessing the severity of the sanction, the referee

noted the general rule under ABA Standards § 4.11 that

disbarment is appropriate when an attorney knowingly converts

client property and causes injury to a client, but stated a

"more particularized analysis is required" because in Constant I, this court imposed less severe punishment for the same type

of conduct. That said, the referee agreed with the OLR that the

facts of this case involved "multiple aggravating factors under

ABA Standards §§ 9.22(a)—(d) and (g)—(k)," including "prior

disciplinary history, dishonest or selfish motive, a pattern of

misconduct, multiple offenses, refusal to acknowledge the

wrongful nature of the conduct, vulnerability of the victims,

substantial experience in the practice of law, and indifference to paying restitution." However, the referee stated that some 16 No. 2021AP33-D

of these factors "deserve caveats" because most of the

misconduct here occurred before imposition of discipline in

Constant I and because while Attorney Constant's failure to

participate "is deemed a refusal to acknowledge the wrongful

nature of his conduct," it "should be viewed less harshly than

that of an attorney who defends himself unjustifiably." And the

referee further concluded that Attorney Constant's "ill-fated

petition to surrender his law license" could be "construed,

albeit generously, as an acknowledgment of wrongful conduct."

Out of those factors, the referee concluded that the most

important aggravating factor was Attorney Constant's "apparent

indifference to paying restitution."

¶32 As to mitigating factors, the referee concluded that

Attorney Constant failed to raise a triable issue of fact as to

whether his health issues caused his misconduct. However, the

referee acknowledged Attorney Constant's legal career spanned

over half a century and that in Constant I, this court noted

that he "brought credit to the legal profession by his many positive community involvements." The referee concluded that in

the prior case, "this Court accorded substantial weight to this

mitigating factor" given the imposition of only a six-month

suspension.

¶33 The referee then looked to prior disciplinary cases

cited by the OLR——including In re Disciplinary Proceedings

Against Runyon, 2020 WI 74, 393 Wis. 2d 612, 948 N.W.2d 62; In

re Disciplinary Proceedings Against Grogan, 2014 WI 39, 354 Wis. 2d 659, 847 N.W.2d 817; and In re Disciplinary Proceedings 17 No. 2021AP33-D

Against Krombach, 2005 WI 170, 286 Wis. 2d 589, 707 N.W.2d 146——

and concluded that none of them "definitively assist with the

choice between a lengthy suspension or revocation" in this case.

Surveying several other decisions, the referee concluded that

"[i]n other instances of an attorney's conversion of a

significant amount of money that was or should have been held in

trust for clients, this Court has typically imposed revocation

in the absence of substantial mitigating facts." The referee

stated that such mitigating facts include "restitution of all or

almost all of the converted funds, other indicia of remorse and

acceptance of responsibility, and unusually severe adverse

conditions that affected the attorney and were not of his or her

own making."

¶34 The referee concluded that no mitigating factors were

present in this case and that "[t]he decisive fact in [the]

analysis is the lack of evidence that Attorney Constant has so

much as lifted a finger to reimburse the victims of his

misconduct, or at the very least to explain why he cannot do so." The referee further explained that Attorney Constant's

long legal career and contributions to the community were

"insufficient to counterbalance his complete indifference to

restitution."

¶35 The referee concluded that revocation was "necessary

to fulfill at least two of the four primary goals of attorney

discipline: to address the seriousness of the misconduct, and

to deter other attorneys from engaging in similar misconduct." And while the OLR had advised that the Fund reimbursed S.C.'s 18 No. 2021AP33-D

loss of $47,557.30, that "did not lessen the seriousness of

Attorney Constant's conversion. It merely transfers the loss

from S.C. to all members of the Wisconsin Bar."

¶36 Accordingly, the referee recommended that this court

revoke Attorney Constant's license to practice law in Wisconsin

and further recommended that the court order Attorney Constant

to pay restitution in the amount of $47,557.30 to the Fund,

$5,757.87 to S.R., and $225.70 to M.R. Finally, the referee

recommended that Attorney Constant be assessed the full costs of

this proceeding, which were determined to be $4,135.06, and that

costs be paid after Attorney Constant paid restitution.

¶37 We review the referee's findings of fact under the

clearly erroneous standard and review conclusions of law de

novo. Runyon, 393 Wis. 2d 612, ¶11. We determine the

appropriate level of discipline independent of the referee's

recommendation. Id.

¶38 We first address the issue of default. Having

reviewed the record, we see no reason to disturb the referee's factual findings that Attorney Constant was properly served with

the complaint via substitute service and that he did not timely

file an answer. The record shows that the OLR made several

unsuccessful attempts at personal service at the address listed

on file for him with the State Bar. The OLR then accomplished

substitute service on Attorney Constant by mailing a certified

copy of the complaint to that address which was then forwarded

and delivered to Henderson, Nevada. See SCR 22.13(1) (if personal service cannot be accomplished then substitute service 19 No. 2021AP33-D

may be effectuated by "sending by certified mail an

authenticated copy of the complaint and order to answer to the

most recent address furnished by the respondent to the state

bar"). Attorney Constant did not file an answer within the time

prescribed by the rules and indeed filed no answer at all. See

SCR 22.14(1) ("The respondent shall file an answer with the

supreme court and serve a copy on the office of lawyer

regulation within 20 days after service of the complaint").

¶39 While nothing in our supreme court rules or the rules

of civil procedure require proof of actual notice before a

default for failing to answer can be declared,15 given the

severity of the recommended sanction in this case, we further

agree that the record supports the referee's determination that

Attorney Constant had actual knowledge of this proceeding before

the referee declared a default. After the complaint was filed,

but before service was accomplished, Attorney Constant filed a

Petition to Voluntarily Surrender a Wisconsin Law License,

listing a P.O. Box address in Henderson, Nevada, and indicating that he had "grievances pending against me, which I cannot

successfully defend." This filing demonstrates Attorney

Constant's actual knowledge of the disciplinary proceeding.

See SCR 22.15(1) (permitting referee to consider a motion 15

for default following the scheduling conference); SCR 22.16(1) (stating that a referee has the powers of a judge trying a civil action and that the rules of civil procedure and evidence shall be followed); Wis. Stat. § 806.02(1), (3) (default judgment may be entered after time for joining issue has expired upon proof of service).

20 No. 2021AP33-D

¶40 Additionally, the referee mailed copies of all

pleadings, motions, orders, and correspondence to Attorney

Constant's address on file with the State Bar and sent copies of

the same to the e-mail address Attorney Constant maintained on

file with the State Bar. Attorney Constant also returned signed

medical release authorizations to the OLR, as ordered by the

referee.

¶41 Finally, after the OLR filed its motion for default,

the referee entered an order giving Attorney Constant additional

time to file a response and assert any defenses he wished to

make. The referee indicated that this order, in addition to

being sent in the manner described above, was also mailed to a

residential address in Henderson, Nevada, that was provided to

the OLR by Attorney Constant's wife. See Wis. Stat. § 801.14(1)

("No service need be made on parties in default for failure to

appear.").

¶42 Therefore, the record demonstrates that the OLR made

proper substitute service of the complaint on Attorney Constant, that he had actual awareness of the proceeding, that he was

provided with notice of the motion for default, and that he

chose not to join issue or otherwise respond to the allegations

21 No. 2021AP33-D

against him in this proceeding.16 We agree with the referee that

Attorney Constant is in default for failing to timely answer and

join issue. In re Disciplinary Proceedings Against Kelly, 2012

WI 55, ¶19, 341 Wis. 2d 104, 814 N.W.2d 844 ("A defendant's or

respondent's failure to join issue is the usual situation where

a default may be declared").

¶43 Because Attorney Constant is in default for failure to

timely answer, the allegations in the complaint are accepted as

true for purposes of this proceeding. Id., ¶25. The referee

therefore properly relied upon the allegations in the complaint

as clear, satisfactory, and convincing evidence that Attorney

Constant committed all 13 counts of misconduct as alleged in the

complaint. Runyon, 393 Wis. 2d 612, ¶12.

¶44 We next address the issue of the proper level of

discipline in this case. We agree with the referee that given

the nature of the conduct involved in the 13 charged counts of

misconduct, as well as Attorney Constant's prior disciplinary

record, that the appropriate discipline in this case is to revoke Attorney Constant's license to practice law in Wisconsin,

16While the referee raised the issue of a possible medical incapacity defense in this case, see SCR, 22.16(4)(a), the record shows that after reviewing some of Attorney Constant's medical records, the OLR was unable to make a determination on the issue and that the referee gave Attorney Constant the opportunity to assert a incapacity defense in response to the OLR's motion for default. As no medical incapacity claim was ever made in this proceeding, we do not discuss the matter further.

22 No. 2021AP33-D

require him to pay restitution to his former clients and the

Fund, and impose the full costs of this proceeding.

¶45 In determining the appropriate sanction, we consider

the following factors: "the seriousness, nature and extent of

the misconduct; the level of discipline needed to protect the

public; the need to impress upon the attorney the seriousness of

the misconduct; and the need to deter other attorneys from

similar misconduct." In re Disciplinary Proceedings Against

Zenor, 2021 WI 77, ¶10, 399 Wis. 2d 326, 964 N.W.2d 775.

Generally, attorney discipline is progressive in nature absent

extenuating circumstances. In re Disciplinary Proceedings

Against Dade, 2017 WI 51, ¶9, 375 Wis. 2d 140, 895 N.W.2d 37.

¶46 We agree with the referee that progressive discipline

is appropriate in this case given Attorney Constant's prior

disciplinary history and sanctions imposed in Constant I. In

that proceeding we suspended Attorney Constant's license to

practice law for six months as a result of nine counts of

misconduct involving an array of trust account violations including failing to maintain trust account records, failing to

provide written notice of receipt of settlement proceedings in

trust, failing to promptly disburse settlement proceeds,

converting trust funds for business and personal use, making

improper electronic transfers from client trust accounts, making

disbursements from a client trust account before funds were

deposited that were attributable to the matter, and depositing

personal funds into his trust account. Constant I, 390 Wis. 2d 1, ¶24. The referee in that case characterized the 23 No. 2021AP33-D

misconduct as "serious" and said these were "major violations."

Id., ¶27. We imposed a more severe sanction than recommended by

the referee in that case because Attorney Constant was not

remorseful for his conduct and "consistently maintained he did

nothing wrong." Id., ¶45.17 We decided that a six-month

suspension was appropriate because requiring Attorney Constant

to petition for reinstatement would "provide assurance that he

can be safely recommended to the profession, the courts, and the

public as a person who is fit and capable to practice law in

this state." Id.

¶47 The referee concluded that the misconduct in this case

was a continuation of a pattern of trust account violations in

Constant I. We agree. But the conduct in the present case is

much more severe. Whereas Attorney Constant ultimately made

restitution to the client whose trust funds he converted in the

previous matter, id., ¶46, in the present case, he pocketed over

$53,000 in trust funds belonging to his clients or lienholders.

And while Attorney Constant attempted to (unsuccessfully) justify his misconduct in the prior case as a simple matter of

poor bookkeeping practices, no such claim can be made in the

present case. The record demonstrates multiple instances where

Attorney Constant converted large sums of client trust funds for

The court imposed a six-month suspension requiring a 17

petition for reinstatement whereas the referee recommended only a five-month suspension. In re Disciplinary Proceedings Against Constant, 2020 WI 4, ¶¶1–2, 390 Wis. 2d 1, 937 N.W.2d 599. Justice Hagedorn dissented and would have adopted the referee's recommended five-month suspension. Id., ¶53.

24 No. 2021AP33-D

his own personal use, misrepresented the status of settlement

payments to clients, and fraudulently attempted to characterize

disbursements as relating to closed or unrelated legal matters.

In short, the record here demonstrates repeated instances of

outright theft of client trust funds and misrepresentations in

an attempt to justify it.

¶48 While the referee focused almost exclusively on the

Attorney Constant's conversion of trust funds, we note that the

misconduct here is more serious than in Constant I in other

respects. For instance, Attorney Constant settled a portion of

S.R.'s claim without her approval. He closed his law practice

while S.R.'s and M.R.'s claims were unresolved and after the

statute of limitations had run on some of the claims, and

refused to communicate with them about their case——effectively

abandoning them and their unresolved claims. Moreover, despite

the suspension of his license following Constant I, he continued

to practice law by attempting to negotiate and resolve minor

aspects of S.R.'s and M.R.'s claims. In so doing, Attorney Constant exhibited indifference to his professional

responsibilities to his clients and also a clear disregard of

the authority of this court.

¶49 We agree with the referee that the nature, extent, and

severity of misconduct involved here "calls for a sanction

substantially more severe" than the six-month suspension we

meted out in Constant I. The referee discussed several prior

disciplinary cases where this court concluded that revocation of an attorney's license was a proper sanction for repeated 25 No. 2021AP33-D

occurrences of conversion of client trust funds. While the

referee found distinguishing facts in several of these cases,

and while we agree that no two cases are the same and each must

be decided on its own particular facts, we conclude that many of

the cases the referee discussed demonstrate that revocation is

the appropriate sanction in the present matter.

¶50 For instance, in Grogan, 354 Wis. 2d 659, we revoked

the license of an attorney with prior disciplinary history 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

investigation into his misconduct. In Runyon, 393 Wis. 2d 612,

¶23, we revoked the license of an attorney with several prior

disciplinary matters who committed 23 counts of misconduct

involving four separate clients, including conversion of large

sums of trust funds based on "a clear pattern of misconduct by

Attorney Runyon and disregard for his obligations as an attorney

in this State." While there are some factual differences between these two cases and Attorney Constant's current

misconduct, we nevertheless conclude that the facts of the

present case demonstrate a similar pattern of misconduct and

disregard for Attorney Constant's obligations as an attorney in

this state.

¶51 The referee found In re Disciplinary Proceedings

Against Hinnawi, 202 Wis. 2d 113, 549 N.W.2d 245 (1996) most

analogous. In that case, this court concluded that revocation was proper where the attorney timely failed to perform his 26 No. 2021AP33-D

duties as representative of an estate, charged it an

unreasonable fee, failed to keep funds in his client trust

accounts, made numerous misrepresentations to the OLR's

predecessor agency during its investigation, practiced law while

suspended from practice, and did not respond to client

inquiries. The referee also discussed Krombach, 286

Wis. 2d 589, ¶63, where this court revoked an attorney's license

for converting large sums of a client's money for personal use,

altered documents in an attempt to hide his theft, took

advantage of a vulnerable client, and failed to accept

responsibility for his wrongful actions. In so doing, we stated

that "[a]lthough each case turns on its specific facts, in many

instances we have revoked the licenses of attorneys that have

converted client funds to their own personal use." Id., ¶63.

Again, while neither Hinnawi nor Krombach involve the exact same

set of facts as the present case, the nature and seriousness of

the misconduct in those cases is analogous to Attorney

Constant's multiple instances of misconduct, and the sanction imposed in those cases demonstrate that revocation is warranted

in the present case.

¶52 Accordingly, after a careful review of the record and

similar disciplinary cases, we agree with the referee that

revocation of Attorney Constant's license to practice law in

Wisconsin is appropriate in this case. The misconduct here

involves repeated instances of Attorney Constant converting

large sums of client trust funds for his personal use, failing to advise his clients of the status of their cases and 27 No. 2021AP33-D

settlement proceedings, multiple acts of dishonesty in

attempting to falsely characterize disbursements, abandoning and

failing to communicate with his clients, an act of settling a

claim without his client's permission, and practicing law while

his license was suspended for engaging in similar conduct in the

past. Attorney Constant has not acknowledged the wrongful

nature of his actions, shown any remorse, or attempted to make

restitution. Nor is there any evidence of other mitigating

factors that could explain Attorney Constant's actions. Cf. In

re Disciplinary Proceedings Against Nunnery, 2009 WI 89, ¶82,

320 Wis. 2d 422, 769 N.W.2d 858 (revocation not appropriate in

case of conversion of client funds, misrepresentations, and

other misconduct when attorney "indicated his remorse, accepted

responsibility . . . made significant restitution" and where

attorney was "faced with significant stressors involving his

health, his family, as well as his law practice.") Revocation

is necessary given the seriousness of Attorney Constant's

misconduct, the harm caused to his clients, his prior disciplinary history, and the need to deter attorneys from

engaging in similar misconduct and protect the public.18

¶53 We agree with the referee that Attorney Constant

should pay restitution to his clients. However, given that the

Although three justices join the concurrence authored by 18

Chief Justice Ziegler, that fact does not effect a change to our current rule governing license revocation. See SCR 22.29(2).

28 No. 2021AP33-D

Fund has already reimbursed S.C.,19 we order that the amounts

owed to S.R. and M.R. be given priority before restitution is

made to the Fund. Finally, we follow our normal practice of

imposing the full costs associated with this matter. See SCR

22.24(1m).

¶54 IT IS ORDERED that the license of Terry L.r Constant

to practice law in Wisconsin is revoked, effective the date of

this order.

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

of this order, Terry L. Constant shall pay restitution as

follows: $5,757.87 to S.R.; $225.70 to M.R.; and $47,557.30 to

the Wisconsin Lawyers' Fund for Client Protection for the claims

of S.C., after full restitution has been made to S.R. and M.R.

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

of this order, Terry L. Constant shall pay to the Office of

Lawyer Regulation the costs of this proceeding, which are

$4,135.06 as of June 20, 2022.

¶57 IT IS FURTHER ORDERED that payment of restitution is to be completed prior to paying costs to the Office of Lawyer

Regulation.

¶58 IT IS FURTHER ORDERED that all pleadings and documents

filed by the parties in this matter that have been marked sealed

As noted, the OLR informed the referee in a pleading that 19

the Fund paid the full amount of S.C.'s claim for $47,557.30. While there is no documentation of that payment in the record, we will accept the OLR's representation that such payment was made.

29 No. 2021AP33-D

or confidential shall remain so until further order of the

court.

¶59 IT IS FURTHER ORDERED that Terry L. Constant 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.

¶60 IT IS FURTHER ORDERED that the administrative

suspension of Terry L. Constant's license to practice law in

Wisconsin, due to his failure to pay mandatory bar dues and for

failure to file Office of Lawyer Regulation trust account

certification, will remain in effect until each reason for the

administrative suspension has been rectified pursuant to SCR

22.28(1).

30 No. 2021AP33-D.akz

¶61 ANNETTE KINGSLAND ZIEGLER, C.J. (concurring). I

concur in the court's order revoking Attorney Constant's license

to practice law in Wisconsin. I write separately to point out

that in Wisconsin the "revocation" of an attorney's law license

is not truly revocation because the attorney may petition for

reinstatement after a period of five years. See SCR 22.29(2).

I believe that when it comes to lawyer discipline, courts should

say what they mean and mean what they say. We should not be

creating false perceptions to both the public and to the lawyer

seeking to practice law again. See In re Disciplinary

Proceedings Against Moodie, 2020 WI 39, 391 Wis. 2d 196, 942

N.W.2d 302 (Ziegler, J., dissenting). And, as I stated in my

dissent to this court's order denying Rule Petition 19-10, In

the Matter of Amending Supreme Court Rules Pertaining to

Permanent Revocation of a License to Practice Law in Attorney

Disciplinary Proceedings, I believe there may be rare and

unusual cases that would warrant the permanent revocation of an

attorney's license to practice law. See S. Ct. Order 19-10 (issued Dec. 18, 2019) (Ziegler, J., dissenting).

¶62 I am authorized to state that Justices REBECCA GRASSL

BRADLEY, BRIAN HAGEDORN, and JILL J. KAROFSKY join this

concurrence.

1 No. 2021AP33-D.akz