STATEWIDE GRIEVANCE COMMITTEE

Douglas C. Steimle, Complainant vs. Gail M. Kemp, Respondent

Grievance Complaint #95-0448

PROPOSED DECISION

Pursuant to Practice Book '2-35, the undersigned, duly-appointed reviewing committee of the Statewide Grievance Committee, conducted a hearing at the Superior Court, 1061 Main Street, Bridgeport, Connecticut on May 8, 1996, and on subsequent dates, July 10, 1996, October 23, 1996, January 29, 1997, May 14, 1997, July 9, 1997 and September 10, 1997. The hearing addressed the record of the complaint filed on December 1, 1995, and the probable cause determination filed by the Stamford/Norwalk Judicial District Grievance Panel on December 27, 1995 finding that there existed probable cause that the Respondent violated Rules 1.1, 1.2, 1.3, 1.4, 1.5, 1.15, 2.1, 3.3, 4.1, 4.4, and 8.4 of the Rules of Professional Conduct.

Notice of each hearing date was mailed to the Complainant and to the Respondent. The Respondent appeared on each hearing date, and was represented during the course of the hearing by Attorneys David J. Robertson and Madonna Sacco. The Complainant also appeared on each hearing date, and was represented by Attorney Kenneth A. Votre. This reviewing committee heard testimony from the Complainant and Respondent, as well as testimony from a number of witnesses presented by both the Complainant and Respondent. A number of exhibits were admitted into evidence. This reviewing committee also received post-hearing briefs from the Complainant and Respondent.

On January 29, 1997, the Respondent filed a Motion to Dismiss the instant complaint. The Complainant filed a memorandum of law opposing the Motion to Dismiss. On May 14, 1997, this reviewing committee provided the Complainant and Respondent with an opportunity for oral argument on the Respondent's motion. While this reviewing committee did not explicitly deny the Respondent's motion, this reviewing committee did decide to reserve its judgment on whether or not to dismiss the instant complaint until the conclusion of the evidence in this matter.

This reviewing committee finds the following facts by clear and convincing evidence:

On March 9, 1985, D. Christian Gauss died, leaving a last will and testament naming Catherine Davis Gauss and Douglas B. Steimle as co-executors. In March of 1985, the co-executors retained the Respondent to represent them and to handle the probate of the estate. The Respondent filed an application for the probate of the will on or about March 28, 1985, and the probate court for the district of New Canaan, Connecticut entered a decree admitting the will to probate on or about April 1, 1985.

During the period of time that the Respondent was responsible for probating the estate of D. Christian Gauss, federal fiduciary income tax returns for the tax years ending in 1988, 1989, 1990, and 1991 were not filed for the estate. The income taxes for those years were not paid. It was unclear whether a return was filed for the tax year ending in 1987. However, no tax was paid for that year. Although the Respondent prepared the tax return for the initial tax year ending in February, 1986, Catherine Davis Gauss advised the Respondent that she would arrange to have federal fiduciary income tax returns prepared for subsequent years. The Respondent made requests of Ms. Gauss for copies of the tax returns, but Ms. Gauss failed to provide any. The Respondent was aware during this period that no checks for these taxes had been written from the estate's checking account, which was in the Respondent's possession. Notwithstanding the fact that she had not seen copies of any federal fiduciary income tax returns for the years subsequent to 1986, and was aware that no checks for taxes had been written from the estate checking account for the returns for those years, the Respondent continued to rely on Ms. Gauss' representations to her that the returns had been filed. The Respondent assumed that Ms. Gauss paid the taxes due with her own funds, to be reimbursed at a later date by the estate.

In November of 1990, the Respondent filed the estate's final account with the probate court. The account had been signed by the fiduciaries in December of 1989, almost a full year earlier. There was no explanation provided to this reviewing committee as to why it took the Respondent so long to actually file the account. A hearing on the account was not held until December of 1993. The account indicated that the estate had paid federal fiduciary income taxes in the amounts of nine thousand one hundred twenty-five dollars and eleven cents ($9,125.11) for 1986; four thousand one hundred nineteen dollars and fifty-five cents ($4,119.55) for 1987; three thousand seven hundred thirty-four dollars and seventy-six cents ($3,734.76) for 1988; and two thousand four hundred sixty-four dollars and twenty-four cents ($2,464.24) for 1989. These amounts had not in fact been paid by the estate or by Ms. Gauss. The Respondent estimated these amounts when Ms. Gauss failed to provide her with documentation regarding either the fact of the filing of the returns or any evidence that she had paid them. In spite of the fact that no hearing was held on the accounting until December of 1993, providing the Respondent with yet additional time to ascertain whether or not the information provided by Ms. Gauss was accurate, it appears that there was still nothing done by the Respondent to correct these errors in the accounting. In addition, the value for a Citibank checking account was incorrectly listed in the estate account. The estate's accounting filed by the Respondent was not accepted by the probate court.

At the beginning of June, 1994, the Complainant was appointed as administrator C.T.A. of the estate of D. Christian Gauss, as a result of the death of Catherine Davis Gauss and the incapacity of his father, Douglas B. Steimle. The Complainant discharged the Respondent on June 2, 1994 and replaced her with Attorney Frank Berall. It was upon Attorney Berall's investigation that it was discovered that, in fact, federal fiduciary income tax returns subsequent to the initial return had never been filed with the possible exception of the return for the year ending in 1987, and that an outstanding liability existed for taxes due.

This reviewing committee finds by clear and convincing evidence that the Respondent failed to provide competent representation to her client, in violation of Rule 1.1 of the Rules of Professional Conduct, and failed to exercise reasonable diligence in her handling of the estate of D. Christian Gauss, in violation of Rule 1.3 of the Rules of Professional Conduct. There is clear and convincing evidence before this reviewing committee that the Respondent prepared the estate account relying on information provided by one of the co-fiduciaries, Catherine Davis Gauss, that Ms. Gauss had arranged for the preparation of the federal fiduciary tax returns for the years subsequent to the initial return filed by the Respondent. The Respondent also relied on information provided by Ms. Gauss that she had paid the taxes. While an attorney is entitled in most instances to rely on information provided by his or her client, that reliance must be reasonably exercised, especially when that information will be transmitted to a tribunal, as in the case of an account prepared for a probate court. It was not reasonable in this instance for the Respondent to rely on the information provided by her client regarding the federal fiduciary income tax returns. Over a period of several years, Ms. Gauss failed to provide the Respondent with any documentation from which the Respondent could reasonably have inferred that the tax returns had been filed, and the taxes paid. In the absence of this information the Respondent estimated the amount of taxes purportedly paid in preparing the account. As a result, the account prepared by the Respondent reflected that taxes were paid, even though the Respondent had no information confirming that Ms. Gauss had filed the returns in question, or paid the taxes, and even though the Respondent was aware that no checks had been drawn on the estate checking account for the payment of the subject taxes. Therefore, the accounting was inaccurately prepared. A hearing regarding the accounting was held by the probate court in December of 1993, and no correction to the account was provided by the Respondent at that time. Inexplicably, considering the lapse of time between the filing of the account and the probate court's hearing on the same, the Respondent still failed to determine that the returns had not been filed, and taxes were not paid. The Respondent's representation required the preparation of an accurate accounting, and the presentation of an accurate accounting to the probate court. The Respondent failed to accomplish either of these tasks. To compound matters, at least one of the estate's assets, a Citibank checking account, was incorrectly valued in the accounting. The failure of the Respondent to accurately prepare the accounting, her failure to properly investigate and confirm facts which were being presented to her by one of the fiduciaries relative to the accounting so that an accurate accounting could be prepared, and her failure to correct the errors in the accounting despite having ample time to discover the actual status of the tax returns at issue, demonstrated a lack of competence and diligence which violated Rules 1.1 and 1.3 of the Rules of Professional Conduct. In addition, we also find that the unexplained delay of nearly a year from the time that the accounting was signed by the fiduciaries to the time it was actually filed with the probate court represented a lack of diligence on the part of the Respondent which also violated Rule 1.3 of the Rules of Professional Conduct.

We do not find in the record adequate evidence that the Respondent violated Rules 1.2, 1.4, 1.5, 1.15, 2.1, 3.3, 4.1, 4.4 or 8.4 of the Rules of Professional Conduct. However, as we have found by clear and convincing evidence that the Respondent violated Rules 1.1 and 1.3 of the Rules of Professional Conduct, it is our recommendation that the Statewide Grievance Committee reprimand the Respondent.

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Attorney Alfred R. Belinkie

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Attorney Lewis A. Hurwitz

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Mr. Neal Jewell