(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the interests of brevity, portions of any opinion may not have been summarized).
In the Matter of Kevin P. Wigenton, an Attorney at Law (D-131-10) (068659)
Argued November 30, 2011 -- Decided April 3, 2012
This attorney disciplinary matter concerns Kevin P. Wigenton of Red Bank, who was admitted to the practice of law in New Jersey in 1992. The Office of Attorney Ethics (OAE) charged Wigenton with multiple instances of knowing misappropriation of client trust funds and escrow funds, and with acting with a conflict of interest by representing the seller while serving as a real estate broker in the same real estate transaction. The charges against respondent were brought after the OAE conducted an initial random compliance audit and then a second audit in the latter part of 2002. They were not the result of grievances by clients or other parties to transactions handled by Wigenton. Wigenton had practiced as a sole practitioner beginning in 1996. Prior to that time, he had worked for the corporation that had employed him full time while he attended law school. He had never worked in a law practice under the supervision of other attorneys.
The ethics charges against Wigenton were presented by the OAE to a Special Ethics Master, who developed an extensive record. The Special Master found that respondent did not knowingly misappropriate either trust or escrow funds, but rather, that he had negligently misappropriated the funds through concededly "terrible" recordkeeping practices that led respondent to the reasonable, but mistaken, belief that he was entitled to the funds at issue. The Special Master found that Wigenton's negligent misappropriation was not a matter of willful ignorance designed to camouflage a more serious intent to take funds to which he was not entitled. The Special Master found that in addition to negligently misappropriating funds, respondent had committed recordkeeping violations and had acted with a conflict of interest in the real estate matter. The Special Master recommended to the Disciplinary Review Board (DRB) that Wigenton be suspended from practice for a period of four months for his unethical conduct.
After an exhaustive review of the record, the DRB agreed with the Special Master that Wigenton had negligently misappropriated client trust and escrow funds and had failed to safeguard funds, in violation of RPC
1.15(a); had failed to comply with attorney recordkeeping requirements; and had committed a conflict of interest contrary to the direction in Advisory Committee on Professional Ethics Opinion 514, 11 N.J.L.J. 392 (Apr. 14, 1983) and in violation of RPC 1.7(b). The DRB concluded that because of mitigating factors present in the record, Wigenton should be censured rather than suspended from practice.
The OAE filed a petition for review of the decision of the DRB, urging that Wigenton be disbarred. The Court granted the petition for review and issued an Order directing Wigenton to show cause why he should not be disbarred or otherwise disciplined.
HELD: Kevin P. Wigenton failed to safeguard and negligently misappropriated escrow and client trust funds, violated attorney recordkeeping rules, and acted with a conflict of interest. For his unethical conduct, he is censured.
1. The Court agrees completely with the conclusion of the DRB that the proofs in the record demonstrate negligent, but not knowing, misappropriation of funds by respondent. In their thorough and detailed reviews of the evidence, both the Special Master and the DRB concluded that respondent reasonably believed he was entitled to the funds. Respondent displayed at worst a woeful lack of knowledge of the actual status of his accounts when he disbursed legal fees and costs to himself. The DRB found his recordkeeping "grossly deficient," but this was not a situation in which respondent was intentionally ignorant and had a nefarious intent. Moreover, no client or other person was harmed. (pp.4-5).
2. The Court also agrees with the DRB that a censure is the appropriate quantum of discipline for respondent's unethical conduct, considering both the mitigating and aggravating factors present in the record. Among the aggravating are respondent's failure to understand his ethical obligations and his total lack of knowledge or use of basic attorney recordkeeping procedures despite his accounting background. The more numerous mitigating factors include the facts that respondent was contrite and cooperative, immediately retained appropriate business professionals to assist him in his practice, discontinued improper business procedures, instituted all required recordkeeping measures, and took an ethics course in trust accounting. Also, despite respondent's recordkeeping deficiencies, during the period covered by the audit, his trust account never was overdrawn, no clients or third parties were harmed, and all other aspects of his transactions took place properly. Finally, the significant amount of time that passed during the proceedings since irregularities were discovered in the first audit in 2002 is one of the most persuasive mitigating factors. (pp. 6-9).
3. In addition to supporting the reasoning of the DRB for imposition of a censure, the Court emphasizes the purpose of attorney discipline: protection of the public and preservation of public confidence in the bar. Those interests are served by a censure of respondent, who was forthright about his errant recordkeeping practices, cooperated in the ethics proceedings, took educational courses, and who has had no further problems in the past ten years. (pp. 9-11).
The ethical violations found by the DRB are AFFIRMED and Kevin P. Wigenton is CENSURED.
JUDGE WEFING (temporarily assigned) filed a separate, DISSENTING opinion. Judge Wefing is of the view that a short period of suspension is called for to preserve public confidence in the bar. Judge Wefing does not see respondent's corrective measures, the fortuity that no client was harmed, or the protracted nature of the disciplinary proceedings, singly or in combination, as mitigating the quantum of discipline required.
CHIEF JUSTICE RABNER and JUSTICES LaVECCHIA, ALBIN, HOENS and PATTERSON join in the Court's Opinion. JUDGE WEFING, temporarily assigned, filed a separate, dissenting Opinion.
On an Order to show cause why respondent should not be disbarred or otherwise disciplined.
This disciplinary matter was commenced by a 2006 complaint filed by the Office of Attorney Ethics (OAE) charging respondent, Kevin P. Wigenton of Red Bank, who was admitted to the bar in this State in 1992, with two instances of knowing misappropriation of trust funds, six instances of knowing misappropriation of escrow funds, and representing the seller while serving as a real estate broker in the same real estate transaction. A 2007 amendment to the complaint, in pertinent part, added four additional instances of knowing misappropriation of client and escrow funds. The counts related to findings discovered as the result of an initial random compliance audit and a second audit, by the OAE. Both took place in the latter part of 2002, six years after respondent had commenced a solo law practice in 1996. Prior to that time, respondent was not engaged in a law practice under the supervision of other attorneys. Instead, he had continued, after graduation from law school and admission to the bar, to work exclusively within the corporation where he had been employed full-time while attending law school. We note at the outset that there is no claim of client harm involved in this matter. None was pled or even remotely presented during the wealth of evidence produced at the hearing on this complaint.
An extensive hearing record was developed and Special Master Neil H. Shuster, J.S.C. (ret.) ultimately recommended a four-month suspension based on the violations that he found to have been proven by clear and convincing evidence. Most important was the Special Master's finding that respondent did not knowingly misappropriate either trust funds or escrow funds. Rather, in a painstaking analysis of the evidence, the Special Master found that respondent reasonably, but mistakenly, believed that he was entitled to the funds in issue in the misappropriations charges pled. Respondent's admittedly "terrible" recordkeeping practices were blamed by the Special Master as the progenitor of that mistaken belief, not a willful ignorance designed to camouflage a more serious intent to take funds to which respondent was not entitled. That critical finding led the Special ...