Iowa Supreme Court Attorney Disciplinary Board v. Kermit L. Dunahoo
2011 Iowa Sup. LEXIS 43
| Iowa | 2011Background
- Kermit L. Dunahoo, admitted Iowa attorney since 1971, placed license on inactive status July 8, 2009; bankruptcy court order in Southern District of Iowa required cessation of bankruptcy practice by May 31, 2008, which he repeatedly violated.
- Respondent represented six clients in foreclosure and bankruptcy matters between 2007–2008 (Scotts, Jerrold Lanphier, Christina Lanphier, Guerra, Paxton, Stogdill) with advance fees and no written fee agreements in five of six counts.
- Board alleged violations across multiple Iowa Rules of Professional Conduct, including failure to comply with bankruptcy court orders, competence and diligence, communication, trust accounting, fees, candor, fairness, supervision, failure to respond to disciplinary authority, and prejudicial conduct.
- Stipulated facts show repeated neglect, disputed avoidable miscommunications, improper withdrawals from client trust accounts, and filing in the wrong district for Guerra’s petition, causing disruption and waste of judicial resources.
- Grievance Commission found seven violations; Board sought suspension; the court conducted de novo review and found ten rule violations; respondent was suspended for one year with costs assessed against him.
- Respondent voluntarily placed his license on inactive status in 2009; the court considered mitigating factors including illness and strenuous personal circumstances, and aggravated factors including a pattern of prior misconduct, ultimately imposing a one-year suspension without reinstatement.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Dunahoo violated the bankruptcy court order and related rules | Board contends violations of 1.16(a)(1) and 8.4(c) due to continuing bankruptcy practice in the Southern District. | Dunahoo argues limitations and scope were misunderstood; contesting breadth of alleged violations. | Yes, violated 1.16(a)(1) and 8.4(c); 1.4(a)(5) not upheld; violation of the bankruptcy order found. |
| Whether Dunahoo acted with competence and diligence | Boardired that Dunahoo failed to reasonably handle matters and neglected timely action. | Dunahoo maintained he possessed necessary knowledge but was hindered by other factors. | Violated 1.3 (diligence) but not 1.1 (competence) according to the record. |
| Whether Dunahoo failed to adequately communicate with clients | Board alleged failure to explain scope, fee basis, and other critical decisions. | Dunahoo asserts communication gaps were due to deficient client understanding. | Violated 1.4(b) for Christina Lanphier and related stipulations; other counts not found. |
| Whether Dunahoo violated trust accounting and accounting requirements | Board asserts failure to provide contemporaneous accounting and notice for withdrawals from trust accounts. | Dunahoo contends accounting shortcomings were not proven as to all funds. | Violated 1.15(f) and 45.7(4); no proven violation of 1.15(a) or (c) due to insufficient detail. |
| Whether Dunahoo violated fee, candor, and related disciplinary rules | Board claims unreasonable or undisclosed fees and deceptive billing practices. | Dunahoo contends fees were not shown to be unreasonable and lacked written agreements. | Violated 1.5(b) for lack of written scope/fee communication; 1.5(a) not proven; 3.3(a) violated; 3.4(c) not proved. |
Key Cases Cited
- Iowa Supreme Ct. Att’y Disciplinary Bd. v. Netti, 797 N.W.2d 591 (Iowa 2011) (de novo review with preponderance standard; deference to commission but not bound by findings)
- Iowa Supreme Ct. Att’y Disciplinary Bd. v. Schmidt, 796 N.W.2d 33 (Iowa 2011) (scope of review; findings not binding; sanctions adjustable)
- Iowa Supreme Ct. Att’y Disciplinary Bd. v. Wagner, 768 N.W.2d 279 (Iowa 2009) (discretion in sanctions considering factual context and public policy)
- Iowa Supreme Ct. Att’y Disciplinary Bd. v. Gailey, 790 N.W.2d 801 (Iowa 2010) (binding effect of stipulations; special caution in applying rules to stipulated facts)
- Iowa Supreme Ct. Att’y Disciplinary Bd. v. Casey, 761 N.W.2d 53 (Iowa 2009) (context for sanctions factors and aggravating/mitigating considerations)