390 P.3d 886
Kan.2017Background
- John P. Biscanin, a Kansas lawyer admitted in 1968, was disciplined after a disciplinary-administrator formal complaint alleging violations of KRPC 1.8 and 1.15.
- Client R.K. received settlement proceeds from an estate; Biscanin deposited some funds into his lawyer trust account but handled $10,000 in cash separately.
- Biscanin either held the $10,000 for safekeeping or received it as a loan/business investment; he executed a promissory note and agreed to pay 6% interest but did not record the transaction in writing as required by KRPC 1.8.
- Biscanin failed to keep complete trust-account records, did not promptly deliver client funds on demand, and made payments from the trust account and business account whose authorization was unclear.
- The hearing panel found violations of KRPC 1.8(a), KRPC 1.15(a),(b),(d)(1),(d)(2); aggravating factors included prior discipline, dishonest motive, pattern of misconduct, deceptive testimony, refusal to acknowledge wrongful conduct, client vulnerability, and extensive experience.
- The Kansas Supreme Court found clear and convincing evidence of the violations, imposed a two-year suspension (stayed after six months), followed by two years supervised probation, and ordered an independent trust-account audit and compliance steps before reinstatement.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether clear and convincing evidence shows Biscanin entered a business transaction with client (KRPC 1.8(a)) | Biscanin agreed to pay interest, executed a promissory note, and paid interest — constituting a business/financial transaction with client requiring written disclosure, independent counsel advice, and written consent | Biscanin said he merely held money for safekeeping at client request and did not enter a business transaction; credibility of panel findings challenged | Court held clear and convincing evidence existed that Biscanin entered a business/financial transaction (loan-like) and violated KRPC 1.8(a) |
| Whether Biscanin violated safekeeping/accounting duties (KRPC 1.15) by failing to deposit and account for client funds | Disciplinary Administrator: Biscanin failed to deposit client funds, maintain records, and promptly return funds on demand | Biscanin did not dispute failure to deposit/keep records but argued he returned funds promptly once he learned of demand (about 6 weeks) | Court held Biscanin violated KRPC 1.15(a),(b),(d)(1),(d)(2); 6-week delay after formal demand was not sufficiently "prompt" |
| Appropriate discipline for knowing misconduct causing client injury | Disciplinary Administrator: suspension warranted for knowing misconduct; recommended audit and probation conditions | Biscanin requested published censure and proposed probation plan | Court imposed 2-year suspension, stayed after 6 months with 2 years supervised probation, required amended probation plan and independent audit |
| Whether panel credibility error (misinterpretation re: public-administrator status) tainted findings | Biscanin argued panel's mistaken credibility finding required remand or disregarding credibility-dependent evidence | Disciplinary Administrator conceded panel misinterpreted one point but argued sufficient other evidence existed | Court concluded the erroneous credibility point did not undermine the clear and convincing evidence supporting violations and declined remand |
Key Cases Cited
- In re Foster, 292 Kan. 940 (reciting standard that misconduct must be proved by clear and convincing evidence)
- In re Lober, 288 Kan. 498 (defining clear and convincing evidence standard)
- In re Dennis, 286 Kan. 708 (discussing evidentiary standard)
- In re Hawkins, 304 Kan. 97 (deferential review of panel findings when supported by clear and convincing evidence)
- In re Trester, 285 Kan. 404 (same)
- In re Bishop, 285 Kan. 1097 (same)
- In re Hall, 304 Kan. 999 (consideration of aggravating/mitigating factors and applicable sanction standards)
- In re McPherson, 287 Kan. 434 (delay in returning client funds as violating KRPC 1.15)
- Federal Farm Mortgage Corp. v. Bolinger, 152 Kan. 700 (promissory note as primary evidence of indebtedness)
- Gregory v. Williams, 106 Kan. 819 (promissory note evidences indebtedness)
- Capital Co. v. Merriam, 60 Kan. 397 (payment of interest as acknowledgement of debt)
- Coe, Administratix v. First National Bank & Trust Co., 219 Kan. 352 (loan characterized by borrower exercising dominion over money with promise to return)