In re Myers

Citations: 280 Kan. 956; 127 P.3d 325; 2006 Kan. LEXIS 14Docket: No. 95,132

Court: Supreme Court of Kansas; February 2, 2006; Kansas; State Supreme Court

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An uncontested disciplinary proceeding has been initiated against attorney Larry L. Myers, who has been practicing law in Kansas since 1978. The formal complaint alleges violations of KRPC 1.1 (competence) and KRPC 1.5 (fees). A hearing was conducted on July 28, 2005, where Myers appeared with counsel.

Key findings include:
1. Larry L. Myers, Kansas Attorney Registration No. 09793, is based in Garden City, Kansas.
2. In February 1996, he was retained by Robert and Betty Brown for estate planning to ensure asset protection and tax avoidance, with the understanding that Mrs. Brown, being older, would likely need nursing home care.
3. At the time, the Brown estate was valued at approximately $465,000, consisting of various financial accounts and real property.
4. Myers advised the Browns to split their assets into revocable trusts to ensure their children inherited the estate, despite the Browns' preference to retain their assets during their lifetimes. However, this strategy would not protect their assets from Medicaid considerations due to changes in law.
5. The Browns agreed to the trust arrangement, and Myers prepared the necessary documents.
6. Following Mrs. Brown's deterioration and subsequent nursing home placement, Mr. Brown fell ill and passed away on October 27, 1999.
7. After Mr. Brown's death, their daughter, Patricia Willis, consulted Myers regarding the estate, prompting him to communicate the necessary steps for administration, including the preparation of a Kansas Estate Tax Return.
8. Despite Myers' assertion that a tax return was needed, the estate did not exceed the taxable threshold, making the filing unnecessary.
9. For his services related to Mr. Brown's estate, Myers charged $4,250 for 43.5 hours of work, billing primarily in whole hour increments, with one exception.

During the hearing, the Respondent confirmed his billing practices of charging in full one-hour increments, only billing less than an hour if the time spent was three-quarters of an hour or more. Following Mr. Brown’s death and the depletion of Mrs. Brown's trust, Ms. Willis sought Medicaid assistance, which was denied based on the conclusion that Mr. Brown’s trust assets could be used for Mrs. Brown’s nursing home care. The trust document prepared by the Respondent did not achieve its intended goal of protecting Mr. Brown's assets from these expenses.

After the denial of the Medicaid application, Ms. Willis sought the Respondent's advice, who incorrectly recommended an appeal despite established law on Medicaid eligibility. The appeal was ultimately unsuccessful, and the Respondent charged Ms. Willis $3,600 for his work. Complaints were made by Ms. Willis to the Disciplinary Administrator regarding the Respondent's representation, and after Mrs. Brown's passing in 2003, about $30,000 of trust assets were used for her care. 

Ms. Willis then retained another attorney, Robert E. Johnson, II, who suggested a settlement amount of $53,934.37. The Respondent negotiated a settlement by paying $10,000 and waiving the unpaid attorney fee of $3,600. Based on these findings, the Hearing Panel concluded that the Respondent violated Kansas Rules of Professional Conduct (KRPC) 1.1 by failing to provide competent representation and KRPC 1.5 by charging unreasonable fees for unnecessary legal services.

Billing in one-hour increments when less than one hour of work is performed is deemed unreasonable and a violation of the Kansas Rules of Professional Conduct (KRPC) 1.5. The Kansas Supreme Court, in *In re Scimeca*, stated that while billing for quarter hours is permissible if spent on client business, billing for time not actually worked constitutes a violation. The Respondent acknowledged his improper billing practices, claiming ignorance, yet this does not absolve him of responsibility. Evidence presented indicated that the Respondent continued to bill Ms. Willis in one-hour increments without completing that amount of work. The Hearing Panel determined that it is impossible to ascertain the actual time spent on behalf of clients due to these practices.

In recommending discipline, the Hearing Panel applied American Bar Association (ABA) Standards, considering the violated duty, the Respondent’s mental state, and the actual harm caused to clients. The Respondent breached his duty to provide competent representation and to charge reasonable fees, knowingly engaging in misconduct that resulted in actual harm to clients. Aggravating factors included a dishonest motive, as the Respondent misrepresented the law regarding Kansas estate tax returns, and the vulnerability of his clients, who relied on his expertise for estate planning. The Respondent has substantial legal experience, having been admitted to practice law in 1978. A mitigating factor noted was the absence of a prior disciplinary record. Under the ABA Standards, a reprimand is considered appropriate for a lawyer who demonstrates negligence in legal matters that causes client injury or potential injury.

Reprimand is warranted when a lawyer negligently provides incomplete or inaccurate information to a client, leading to injury or potential injury. The Deputy Disciplinary Administrator suggested that the Kansas Supreme Court censure the Respondent, with publication in the Kansas Reports, while the Respondent requested censure without publication. The Hearing Panel unanimously recommended censure with publication due to aggravating factors. Although the Respondent showed remorse regarding the mishandling of estate matters, the court found the Hearing Panel’s findings to be supported by clear and convincing evidence. The court adopted these findings and recommendations but noted a minority opinion favoring private censure. Ultimately, Larry L. Myers is censured per Supreme Court Rule 203(a)(3), with the order to be published in the Kansas Reports, and costs assessed to the Respondent. Justice Davis did not participate, and Justice Marquardt was assigned.