282 A.3d 926
Vt.2022Background
- Respondent Paul Kulig, long-practicing Vermont attorney and family friend, drafted a 2014 enhanced-life-estate (ELE) deed and a will that conveyed his elderly client L.Z.’s home and estate to himself.
- L.Z., in declining health and later in a nursing home, executed the deed and will; Kulig did not obtain or document written informed consent, nor advise her to obtain independent counsel.
- Kulig did not file the deed or will in probate/land records, did not memorialize any written trust terms, and later took possession of personal effects, sold the client’s car and home, and deposited proceeds (some into his personal account, then into a trust account).
- He failed to notify potential beneficiaries or heirs, failed to provide accountings, and sold the house for significantly less than town valuation under a rent-to-own arrangement with acquaintances.
- A PRB hearing panel found violations of Vermont Rules of Professional Conduct 1.7 (conflict of interest) and 1.8(c) (preparing an instrument giving the lawyer a substantial gift) and imposed a three-month suspension.
- The Vermont Supreme Court affirmed the violations and increased the sanction to a five-month suspension, citing serious actual/potential harm, client vulnerability, lack of independent advice, and the categorical prohibition on attorneys drafting documents that benefit themselves.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Kulig’s drafting of documents that conveyed client property to himself created a disqualifying concurrent conflict of interest under Rule 1.7 | ODC: Kulig placed his personal interests over client loyalty, failed to obtain informed written consent, and thus violated Rule 1.7 | Kulig: He acted as trustee and had no personal interest; any conveyance was to be administered for others | Held: Violation. Court upheld panel finding Kulig had a concurrent conflict and failed to secure informed written consent. |
| Whether Kulig violated Rule 1.8(c) by preparing instruments that gave him a substantial gift (or soliciting one) | ODC: Drafting the ELE deed and will naming Kulig as beneficiary violated the categorical prohibition in Rule 1.8(c) | Kulig: He intended the transfer as trustee under an oral trust, not as a gift; thus rule does not apply | Held: Violation. Court affirmed that preparing instruments conferring substantial gifts to the drafting lawyer breaches Rule 1.8(c); the oral-trust claim did not excuse the rule breach. |
| Whether proof of an oral trust (or Kulig’s stated intent to distribute assets) negates the professional-rule violations | Kulig: An oral trust existed and he intended to distribute proceeds to intended beneficiaries, so he did not personally benefit | ODC: Lack of written trust terms, absent beneficiaries’ testimony, and Kulig’s conduct show no adequate protection of client interests | Held: Oral-trust dispute unnecessary to resolve. Even if Kulig intended distributions, drafting instruments that give the lawyer the property is prohibited; claimed oral-trust intent does not excuse violation. |
| Appropriate sanction for the misconduct | ODC: Serious breach of fiduciary duty and client vulnerability warrant substantial suspension | Kulig: Conduct lacked intent to benefit himself; mitigating factors (no prior discipline, community service) support leniency | Held: Increased sanction to five-month suspension (panel’s three months inadequate given harm, vulnerability, lack of remorse, and multiple offenses). |
Key Cases Cited
- In re Wysolmerski, 237 A.3d 706 (Vt. 2020) (guidance on applying ABA Standards and treating panel findings de novo on legal conclusions)
- In re Bowen, 252 A.3d 300 (Vt. 2021) (conflict-of-interest violations; three-month suspension considered)
- In re Gillingham, 896 P.2d 656 (Wash. 1995) (attorney drafting will benefitting self is facial conflict and banned)
- Committee on Professional Ethics & Conduct v. Behnke, 276 N.W.2d 838 (Iowa 1979) (discussing appearance of impropriety when lawyer benefits)
- State v. Gulbankian, 196 N.W.2d 730 (Wis. 1972) (appearance of impropriety alone can violate duties)
- In re Gildea, 936 P.2d 975 (Or. 1997) (drafter responsible for legal effect of documents even without ill intent)
- In re Polevoy, 980 P.2d 985 (Colo. 1999) (discipline routinely imposed where lawyer drafts instrument naming self beneficiary)
- Attorney Grievance Comm’n v. Stein, 819 A.2d 372 (Md. 2003) (suspension for drafting instrument benefitting lawyer; harms public confidence)
- In re Stepovich, 386 P.3d 1205 (Alaska 2016) (similar analysis of undue influence, incapacity to contest, and harm from lawyer-beneficiary arrangements)
- Attorney Grievance Comm’n v. Saridakis, 936 A.2d 886 (Md. 2007) (appearance of impropriety suffices to sustain discipline when lawyer drafts self-benefiting instrument)