FOR THE RESPONDENT FOR THE INDIANA SUPREME COURT
Kevin P. McGoff Donald R. Lundberg, Executive Secretary
8900 Keystone Crossing Dennis K. McKinney, Staff Attorney
Indianapolis, IN 46240 115 West Washington St., Ste. 1060
Indianapolis, IN 46204
SUPREME COURT OF INDIANA
IN THE MATTER OF )
) Case No. 70S00-9608-DI-525
KEVIN W. AULT )
May 26, 2000
By neglecting clients legal affairs, purposefully submitting to courts proposed orders which did
not accurately reflect the courts rulings, and knowingly pursuing a cause of action
in courts without jurisdiction to entertain the action, attorney Kevin W. Ault engaged
in professional misconduct. We find today that his actions warrant suspension
from the practice of law.
This case was heard by a duly-appointed hearing officer upon the Disciplinary Commissions
Amended Verified Complaint for Disciplinary Action. It is now before us
upon that hearing officers report, which finds misconduct as charged as to each
of the four counts. Respondent Ault has petitioned this Court for
review of those findings, pursuant to Ind.Admission and Discipline Rule 23, Section 15,
thereby subjecting this matter to a de novo review. Matter of Frosch,
643 N.E.2d 902 (Ind. 1994). The Commission, while not challenging the hearing officers
findings, has submitted a Memorandum on Sanction, therein arguing that a suspension from
the practice of law for a period of at least six months is
Preliminarily, we note that the respondents admission to the bar of this state
in 1985 confers disciplinary jurisdiction here. Within the review context described above,
we now find that, under Count I, in June 1993 a client being
sued by his former employer for the recovery of medical expenses hired the
respondent to defend the case, as well as to file a counterclaim for
breach of contract and wrongful discharge (the first lawsuit). On July 19,
1993, the respondent answered the complaint and filed the counterclaim in Hamilton Superior
Court, alleging (1) breach of implied contract as well as wrongful discharge in
retaliation for the clients filing of a workers compensation claim, and seeking compensatory
damages; and (2) wrongful discharge and punitive damages. The respondent also
sought to have the employers action removed from small claims court to the
circuit court. The lawsuit was set for trial on January 10,
1994. In anticipation, the clients wife telephoned the respondent shortly before the
trial to speak with him about it. The respondent informed her that
the January 10 trial was not on his calendar, and the trial occurred
without the respondent or his client present. The respondent did telephone the
trial court that morning and advised a staff person that the trial was
not on his calendar and that a conflict would make it impossible for
him to be present. He also moved the court for dismissal without
prejudice of the counterclaim. However, the motion was denied, and the
employer prevailed with a default judgment against the client for $86.32 (plus court
costs and interest) on its claims and the counterclaim. The day after
the trial, the court received the respondents motion for continuance.
The respondent informed his client that the employer had prevailed on one of
its claims, but added that the client could pursue his counterclaims for wrongful
termination and breach of contract in Bartholomew County, the clients county of residence.
On May 18, 1994, the respondent filed on behalf of the client
a lawsuit (the second lawsuit) seeking punitive and compensatory damages from the employer
under theories which were substantially identical to those forming the basis of the
counterclaim in the earlier lawsuit. The employer, along with its formal answer,
filed a counterclaim seeking attorneys fees and costs on the grounds that the
claim was barred by the doctrine of
res judicata and that it was
frivolous and groundless. The respondent failed to answer the counterclaim, and there
was no further activity in the case until a pre-trial conference scheduled for
November 2, 1995.
The client filed a request for investigation with the Commission on February 23,
1995. Subsequently, another attorney, who was working for the client on other
matters, contacted the respondent to request from him the clients files. On
May 18, 1995, the respondent transferred the file to the other attorney.
On December 6, 1995, the respondent, alleging that the other attorney was representing
the client in the second lawsuit, filed in the Bartholomew Superior Court a
motion to withdraw as the clients counsel. The court took the
matter under advisement pending new counsel filing an appearance; however, the other attorney
did not represent the client in the lawsuit and did not file an
appearance. On January 4, 1996, the employers counsel advised the respondent
to dismiss the lawsuit or face a default judgment on the counterclaim.
On February 20, 1996, the employers counsel served on the respondent a copy
of his application for default judgment, and on March 19, 1996, a default
judgment was entered in the case in favor of the employer on its
counterclaim. That judgment after amendment amounted to $1,926.73.
Meanwhile, the clients other attorney filed a legal malpractice action against
the respondent on January 9, 1996, alleging that the respondent failed timely to
file an appeal of the clients Social Security claim, which led to a
default judgment being entered against him in the first case. The respondent
settled this claim for $1,000. While that action was pending, the
respondents attorney, whom he had hired to defend the malpractice suit, contacted both
the clients other attorney and the employers counsel about resolution of the second
lawsuit. Although the clients other attorney never entered an appearance on behalf
of the client in the second lawsuit, she did inform the respondents attorney
that she would recommend that the client sign a stipulation dismissing the second
lawsuit, and even deliver the stipulation to the presiding judge so that the
matter could be finalized. Despite those plans, the clients other attorney
failed to obtain the clients signature on the stipulation of dismissal and have
it delivered to the judge before entry of the default judgment.
By failing to attend the January 10, 1994 trial or to make timely
arrangements to protect his clients interests in the first lawsuit, and by failing
to answer the employers counterclaim or otherwise defend the second lawsuit, the respondent
violated Ind.Professional Conduct Rule 1.3, which requires lawyers to act with reasonable diligence
and promptness while representing clients. The respondent argues that he made a
prompt and diligent effort to make arrangements regarding the January 10 trial of
the first lawsuit. However, those arrangements consisted primarily of a hasty last-minute
phone call to the court advising that he would not be present.
Had the respondent truly been diligent, he would have sought a continuance or
other judicial relief before the time the trial was to begin. As
for his failure to defend the second lawsuit, the respondent argues that he
reasonably believed that his client had discharged him, given his clients grievance and
the request from the clients other lawyer for the case file. However,
the respondent was never formally notified of either his termination as counsel or
that the other attorney had entered an appearance in the second lawsuit because
neither event ever took place. The respondent would have us believe that
the mere inference that he had been fired absolved him of his obligation,
as attorney of record in the case, to protect diligently his clients legal
interests. The fact is that the respondent remained the clients attorney
of record right through the time the default judgment was entered against the
client. He also failed, over a period of more than 18 months,
to respond in any way to the employers counterclaim.
These actions violate
As to the propriety of the respondents filing the second
lawsuit at all, the respondent argues that he relied upon Ind.Small Claims Rule
11(F), as well as Johnson v. Anderson, 590 N.E.2d 1146 (Ind.Ct.App. 1992), for
the proposition that a small claims judgment shall not be considered an adjudication
of any fact at issue and res judicata only applies to the amount.
Id. At 1150.
The respondents argument fails. Small Claims Rule 11(F) provides that [a] judgment
shall be res judicata only as to the amount involved in the particular
action and shall not be considered an adjudication of any fact at issue
in any other action or court. The rule, however, does not
allow a party to relitigate a claim upon which judgment has been entered
in a small claims case.
Cook v. Wozniak, 500 N.E.2d 231, 233
(Ind.Ct.App. 1986), adopted and affirmed, 513 N.E.2d 1222 (Ind. 1987) ([to permit] a
plaintiff who recovered nothing in a small claims action to sue again on
the same claim in another court would be sheer futility.). Instead, S.C.R.
11(F) was intended primarily to limit issue preclusion where some fact in the
small claim action is at issue in another case, and to also
apply to claim preclusion to the extent that claim preclusion would ordinarily bar
all matters which might have been litigated but were not actually litigated in
the small claims action.
Cook at 233. In
his initial counterclaim in the small claims action, the respondent sought compensatory damages
for breach of implied contract and punitive damages for wrongful discharge. After
suffering an adverse judgment in the small claims court on those claims, the
respondent sought the very same relief in the Bartholomew Superior Court. As
such, the respondents second lawsuit, being res judicata because it was the exact
claim litigated to conclusion in the small claims court, was frivolous and nonmeritorious
and thus violated Prof.Cond.R. 3.1.
Under Count II, we find that the respondent represented the wife in a
dissolution action pending in Rush Circuit Court. Final hearing was conducted on
October 11, 1995, at the conclusion of which the respondent was ordered to
prepare a proposed decree in accordance with court instructions. Shortly thereafter, counsel
for the husband requested that the respondent send a copy of the decree
draft to him for inspection. On November 22, 1995, the respondent
submitted the proposed decree directly to the clerks office without providing a copy
to the other attorney. After the clerks office provided the other attorney
with a copy, the attorney noticed that it was not accurate and asked
that it not be signed. One of the errors he noticed
was that the amount of health care expense to be borne solely by
the custodial parent (the respondents client) under the Indiana Child Support Guidelines should
have been $390, and he corrected the proposed decree to reflect that amount.
The attorney then sent a corrected version of the proposed decree to
the respondent. The respondent added that correction and returned a revised
copy to the other attorney, but the other attorney returned it once more
because the respondent had omitted a provision covering notification of the spouse in
medical emergencies. The respondent drafted a third proposed decree which included
the notification provision but which also reduced the amount of uninsured medical expense
to be borne by the respondents client from $390 to $282.
The respondents note accompanying the third proposed decree stated only, Please find enclosed
a copy of the Decree of Dissolution with some revisions. If you
have any questions, please give me a call. The next day,
the other attorney filed a motion asking that the court permit him to
submit a proposed final decree and to award him attorney fees for this
task. The court granted the motion and later denied the respondents motion to
reconsider it. The final decree entered by the court was the one
prepared by the other attorney. Later, the court ordered the respondent to
pay the other attorneys expenses caused by the respondents delay in submitting an
appropriate proposed decree.
Indiana Professional Conduct Rule 3.2 provides that lawyers shall expedite litigation consistent with
the interests of their clients. By failing to ensure that an appropriate
proposed decree was timely filed, the respondent violated the rule. The
respondent argues that any delay was attributable to what he characterizes as a
reasonable dispute between the respondent and opposing counsel over the uninsured medical expenses.
While it is true that several drafts were exchanged, it is also
true that the reason for the final exchange and ultimate request by opposing
counsel that he be allowed to prepare the decree was the respondents surreptitious
reduction of the amount of uninsured medical expense his client was obligated to
bear. Reasonable disputes do not spring from clandestine changes made to already-agreed
Professional Conduct Rule 8.4(d) provides that lawyers shall not engage in conduct that
is prejudicial to the administration of justice. By seeking to gain an
unfair advantage for his client by having, through the use of unreasonable delay,
the court sign a decree contrary to the courts ruling, and by wrongfully
modifying the terms of the proposed decree without advising opposing counsel, the respondent
violated the rule. Although the respondent characterizes the exchanges of the
proposed decrees as a reasonable dispute between lawyers, his tactics were unreasonable.
He simply changed the amount of uninsured medical expense to be borne
by his client without notifying opposing counsel of such change. As such,
his actions were prejudicial to the administration of justice.
Pursuant to Count III, we now find that on November 12, 1993, the
respondent filed in Rush Circuit Court a motion to modify a divorce decree
and to emancipate a child on behalf of the noncustodial parent. During
hearing on the petition on December 17, 1993, the court heard evidence that
the child had taken one semester off from college, but that she was
enrolled to reenter college in the fall of 1994. The courts usual
practice was to not enter an order of emancipation in cases where there
was a basis to believe that the child was going to continue her
education. Instead, the court would abate support until evidence was offered to
demonstrate that the child had returned to school, thereby activating the custodial parents
right to seek support from the noncustodial parent. Evidence at disciplinary hearing
established that the courts usual practice was to issue a ruling from the
bench at the conclusion of the hearing directing the appropriate attorney to prepare
an order consistent with the ruling. There was nothing in the courts
notes from the modification hearing to indicate that the noncustodial parent was to
pay for educational expenses of the child. After the hearing, the
respondent submitted a proposed order on emancipation, which proposed an entry date of
December 1993. Two post-it notes were attached to the courts file
copy of the proposed order. The first read, Aults office to bring
revised order; the second read, 5-7-94 . . .Told [court personnel] we still
have not gotten new order. The judge in the trial court
case testified at disciplinary hearing that, after reviewing these notes, she believed that
the respondent had been directed to prepare an order conforming with her bench
ruling, but that the proposed order he submitted did not abate support as
ordered by the court, but instead unconditionally emancipated the child. The
court several times directed the respondent to change the proposed order.
Rather than comply, the respondent waited two years before contacting the court to
ask why the respondents original proposed order had not been entered. By
that time, the judge no longer remembered why the original erroneous order had
been rejected. On February 22, 1996, the court entered an order granting
time for objections, giving the custodial parent ten days to object to entry
of the two-year old proposed order. The custodial parent was proceeding
se and did not respond, not fully understanding that an order of emancipation
would cut off the noncustodial parents support obligation if the child returned to
school. The judge signed the proposed order on March 4, 1996.
The respondent would have us believe that there was nothing in the respondents
proposed order that did not accurately reflect the judges ruling from the bench.
However, the respondents first proposed order was rejected precisely because, in the
judges opinion, it did not reflect the abatement provisions as articulated by the
judge at hearing. At hearing of this disciplinary case, the judge
testified that she believed, based on her usual custom and practice, that she
directed the respondent to draft a proposed order abating support but not emancipating
the child. The respondents submission some two years later, despite the directives,
did just the opposite. Accordingly, we find that the respondents submission of
an order which did not accurately reflect the trial courts ruling on the
modification and his failure to comply with the trial courts order to submit
a proposed order which accurately reflected the ruling from the bench is conduct
prejudicial to the administration of justice, in violation of Prof.Cond.R. 8.4(d).
Pursuant to Count IV, we now find that a Florida resident drowned in
a Florida lake in 1994. The Florida lake was situated on property
owned by a New Jersey partnership. The victims father, an Indiana resident,
consulted with the respondent about pursuing a wrongful death claim against the partnership
in an Indiana court. The father informed the respondent that, if at
all possible, he wanted the case to remain in Indiana.
The respondent opened an estate for the victim in Franklin County
in November 1995, and the father was appointed personal representative. The respondent
acted as attorney for the estate. Between late 1994 and June 1996, the
father periodically asked the respondent about the status of the contemplated wrongful death
action. The respondent informed him that he had investigators working on it.
In June 1996, the father told the respondent that he would be
fired unless he demonstrated some tangible activity in the case.
On June 22, 1996, the respondent filed a wrongful death action against the
partnership in Franklin Circuit Court. The partnerships sole asset was the real
estate in Florida. It did not engage in a persistent course of
conduct, or derive substantial revenue or benefit from goods, materials, or services used,
consumed or rendered in Indiana. The partnership moved to dismiss the case,
arguing that the Indiana court lacked jurisdiction over a partnership that did no
business in Indiana and which had no other connection with the state.
The trial court granted the motion to dismiss on August 15, 1996.
The respondent filed a timely motion to correct errors and a motion to
amend the complaint, therein alleging that the partnership regularly does or solicits business
in the state of Indiana, or engages in a persistent course of conduct,
and derives substantial revenue or benefit from goods, materials, or services used, consumed
or rendered in Indiana, all pursuant to Indiana Trial Rule 4.4(A)(3).
Although the court granted the respondents motion to amend the complaint, the respondent
never filed an amended complaint. Instead, he sought to have the case transferred
to federal district court, to be filed retroactively to the date of the
state court filing. An order transferring the proceedings was issued October 10,
1996, retroactive to June 24, 1996. The respondent then filed a wrongful
death action in the federal court. The partnership again moved to dismiss,
arguing that the complaint failed to plead facts establishing the federal courts jurisdiction
and stating that the Indiana federal district court lacked jurisdiction over a non-Indiana
defendant for an accident that occurred in Florida. Rather than tell his
client that the partnership sought to dismiss the case, the respondent told him
that the partnership sought to have the case transferred to Florida.
The respondent was not aware of any evidence that the partnership had ever
done or solicited business in Indiana or that it engaged in a persistent
course of conduct, or derived substantial revenue or benefit from goods, materials, or
services used, consumed or rendered in Indiana, nor did the respondent ever try
to learn whether the allegations in the motion to amend were true.
He conducted no discovery at all in either the state or federal case
to learn if the partnership had any connection at all with Indiana.
The respondent withdrew from the federal case on December 19, 1996, and the
federal court dismissed the case without prejudice on jurisdictional grounds on January 9,
By failing to act with reasonable diligence and promptness in filing a wrongful
death action in a court of proper jurisdiction, the respondent violated Prof.Cond.R. 1.3.
By filing the wrongful death claim in both a state and federal
court with no colorable claim that either court had jurisdiction over the matter,
the respondent violated Prof.Cond.R. 3.1 by bringing a nonmeritorious claim. By seeking
an order from a state court (which clearly did not have jurisdiction over
the defendants) which purported to direct the federal court (which also clearly did
not have jurisdiction over the defendants) to accept jurisdiction of the case and
retroactively to docket the case, the respondent engaged in conduct prejudicial to the
administration of justice in violation of Prof.Cond.R. 8.4(d).
Professional Conduct Rule 1.4(b) provides that a lawyer shall explain a matter to
his client to the extent reasonably necessary to permit the client to make
informed decisions regarding the representation. By failing to advise his client as
to the law regarding appropriate jurisdiction for filing a wrongful death suit, by
failing to keep his client apprised of the status of the state and
federal claims, and by failing to inform his client that the state court
had dismissed the claim, the respondent violated the rule. Professional Conduct
Rule 3.3 provides that a lawyer shall not knowingly make a false statement
of material fact or law to a tribunal. By in effect
pleading that the partnership had contacts with Indiana sufficient to confer jurisdiction on
the Franklin Circuit Court without any evidence at all to support that contention,
the respondent violated the rule.
Having found misconduct, we must now decide upon an appropriate sanction. In
so doing, the factors we examine include aggravating and mitigating circumstances. In
mitigation, we note that the respondent has never before been disciplined by this
Court. In aggravation, we note the respondents patterns of misconduct, exemplified,
for example, by his willingness to resort to frivolous litigation and by his
inability diligently to prosecute or defend legal matters clients hired him to handle.
Further, by altering proposed orders without informing opposing counsel in one
case and waiting two years before attempting to induce the judge sign an
order which did not reflect the judges oral ruling in another, the respondent
engaged in deliberately deceptive behavior. In all, we find that the
respondents actions do not represent a single isolated mistake or lapse in professional
judgment, but instead reflect a tendency to resort to inappropriate tactics to either
gain an unfair advantage or cover some professional lapse. Because of that,
as well at the relative lack of mitigating circumstances, we conclude that his
misconduct warrants a significant period of suspension.
It is, therefore, ordered that the respondent, Kevin W. Ault, be suspended from
the practice of law for a period of ninety (90) days, beginning July
3, 2000. At the conclusion of that period, he shall be
automatically reinstated to the practice of law in this state.
The Clerk of this Court is directed to provide notice of this order
in accordance with Admis.Disc.R. 23(3)(d) and to provide the Clerk of the United
States Court of Appeals for the Seventh Circuit, the Clerk of each of
the United States District Courts in this state, and the Clerks of the
United States Bankruptcy Courts in this state with the last known address of
the respondent as reflected in the records of the Clerk.
Costs of this proceeding are assessed against the respondent.
The respondents obligation diligently to represent his client continued despite the apparent
miscommunication between the respondent, his attorney, and the clients other attorney regarding the
stipulation of dismissal of the second lawsuit.
Thus, had the respondent not filed a counterclaim in the small claims
action, he could have filed it as a separate lawsuit and S.C.R. 11(F)
would not have operated as a bar to those claims that could have
been but which were not litigated in the small claims case. The
respondent may have recognized this problem early on, when he sought to have
his counterclaim dismissed without prejudice.
The present set of facts may be contrasted to those at
issue in the case the respondent relies upon, Johnson v. Anderson, 590 N.E.2d
1146 (Ind.Ct.App. 1992), where the Court of Appeals found that S.C.R. 11(F) prohibited
the application of res judicata where, after an adverse small claims judgment, a
party later sued the prevailing party on a wholly distinct claim under the
Deceptive Consumer Sales Act.