Case Resolved But Not The Conflict In The Evidence
A 60-day suspension has been imposed by the Wisconsin Supreme Court for an attorney’s misconduct in his own acrimonious divorce.
This matter came to the OLR’s attention during Rice’s acrimonious divorce proceeding. In 1996, Attorney Rice and Ms. Liesl M. Testwuide (Ms. Testwuide) were married. In 1992, when Ms. Testwuide was still unmarried and childless, Ms. Testwuide’s parents created a trust for the benefit of Ms. Testwuide and her children. Ms. Testwuide was co-trustee of the trust along with Kenneth Kazmierczak, a business associate of Ms. Testwuide’s father.
In 2010, Ms. Testwuide filed for divorce. In July 2011, while the divorce was pending, Ms. Testwuide filed a grievance with the OLR alleging that Attorney Rice had removed over $600,000 from the trust without proper authorization by forging Ms. Testwuide’s signature and the signature of her cotrustee. Attorney Rice self-reported the same misconduct and, in October 2011, Attorney Rice submitted a lengthy written response to the grievance acknowledging that he signed documents without proper authorization but asserting Ms. Testwuide knew and tacitly approved his actions. Ms. Testwuide and Attorney Rice’s divorce judgment was entered in October 2011; they continued to litigate custody, placement, and other issues.
On November 21, 2011, Ms. Testwuide filed a civil action against Attorney Rice and his former law firm, alleging fraud, conversion, and legal malpractice. Testwuide v. Rice, 2011CV1184, Sheboygan County. On December 18, 2012, the circuit court granted Rice’s motion for summary judgment, ruling that several claims were barred by the statute of limitations. In May 2013, a stipulation and order dismissing the remaining claims against Rice was entered.
In the disciplinary case, the attorney stipulated to the forgery and sought a reprimand.
After itemizing a number of unauthorized trust transactions, the referee stated that she was not persuaded by Attorney Rice’s claim that it was “impossible” to locate the cotrustee after the co-trustee relocated to Minneapolis, and found further that the “overwhelming information in this record supports the fact that [Rice’s] misconduct in accessing Trust funds, without authorization was well in excess of any dollar amounts necessary to ‘pay bills.’.” However, the referee acknowledged the “personal nature of the issues leading [Rice] to engage in the misconduct that he admits to” and found credible Attorney Rice’s assertion that he sincerely believed that he was acting as a “de facto” trustee.
Throughout these proceedings Attorney Rice has maintained that he engaged in the trust transactions, albeit unauthorized, but with the knowledge and consent of his wife, who was both a co-trustee and a beneficiary of the trust. He claims that she did not want to be involved in the marital finances. He maintains that the trust funds were used to support a marital lifestyle that exceeded their employment income, and paid for, among other things, property taxes, vacations, and the remodeling of a vacation home. He claims that Ms. Testwuide’s grievance was both selective and incomplete in terms of the trust transactions it identified. The referee did not make specific findings in this regard, however, merely noting the “conflicting” evidence provided. There is no finding that Attorney Rice misused the trust funds.
The court majority ordered a 60-day suspension with payment of full costs.
Justice Abrahamson dissented, joined by Justice Ann Walsh Bradley
I cannot join this per curiam because the stipulation, the referee’s report, and this per curiam do not make clear the nature and extent of Attorney Rice’s conduct that is charged as a violation of SCR 20:8.4(c). Without knowing the nature and extent of the conduct I cannot determine whether a violation of the Code occurred and, if there was a violation, the appropriate discipline. Accordingly, I dissent.
(Mike Frisch)