IN THE MATTER OF PHILLIP E. GUTMAN
Case No. 582-S-188
SUPREME COURT OF INDIANA
599 N.E.2d 604;
1992 Ind. LEXIS 220
September 25, 1992, FILED
DISPOSITION:
[**1]
Having carefully examined all matters presented in this petition for
reinstatement and with the foregoing considerations in mind, we find that the
Petitioner has failed to meet his burden of proof under Admis. Dis. R.
23(4)(b)(4), (6) and (7). Accordingly, the recommendation of the Disciplinary
Commission is accepted, and the petition for reinstatement is denied.
COUNSEL: FOR THE RESPONDENT: Robert W. McNevin, Attorney at Law, 814 East Yoke Street,
Indianapolis, Indiana 46203.
FOR THE INDIANA SUPREME COURT DISCIPLINARY COMMISSION: Charles M. Kidd, Staff
Attorney, 150 West Market Street, Suite 628, Indianapolis, Indiana 46204.
OPINIONBY: PER CURIAM
OPINION:
[*605]
DISCIPLINARY ACTION
Per Curiam
This case is before us on a petition for
reinstatement to the practice of law by Petitioner Phillip E. Gutman. After a hearing
pursuant to Admission and
Discipline Rule 23, Section 18, a majority of the Supreme Court
Disciplinary Commission adopted the findings of the Hearing Officer and
tendered to this Court its
recommendation that the Petitioner should not be reinstated. The Petitioner moved for review,
and the parties briefed their respective positions.
Accepting the Commission's
recommendation, this Court entered
[**2] an order on June 8, 1992, denying the petition for
reinstatement. This opinion more fully sets out the particular findings and our determination
of how such findings support each of the elements found in Admis. Dis. R.
23(4)(b).
Admis. Disc. R. 23(4) allows a person who has resigned from the bar to petition
for
reinstatement after five
years have
elapsed from the date of the order
accepting the
resignation. If costs have been imposed, they must be paid before a petition for
reinstatement may be filed. Subsection (b) of that rule further provides that the petition
for
reinstatement may be granted if the petitioner establishes by clear and convincing evidence
before the
Disciplinary Commission that:
(1) He desires in good faith to obtain restoration of his privilege to practice
law;
(2) He has not practiced law in this State or attempted to do so since he was
disciplined;
[*606] (3) He has complied fully with the terms of the order for
discipline;
(4) His attitude towards the
misconduct for which he was
disciplined is one of
genuine
remorse;
(5) His conduct since the
discipline was posed has been
exemplary and above reproach;
(6) He has a proper understanding of and attitude towards
[**3] the standards that are imposed upon members of the Bar and will conduct
himself in
conformity with such standards;
(7) He can safely be recommended to the
legal profession, the courts and the public as a person fit to be consulted by others and to
represent them and otherwise act in matters of trust and confidence, and in
general to aid in the administration of justice as a member of the Bar and an
officer of the Courts; . . .
Adopting the findings and determination of the Hearing Officer, the
Disciplinary Commission concluded, by a four to two vote, that this Petitioner failed to
sustain his
burden of proof particularly under Rule 23(4)(b)(4) on the issue of
remorse, (4)(b)(6) on the issue of understanding of and
conformity with professional standards, and (4)(b)(7) on the issue of professional
fitness. The Petitioner challenged this determination arguing that the substantial
evidence of
exemplary conduct since his
resignation should be sufficient to sustain his burden under the rule.
In reviewing the Commission's findings and
recommendation in this
reinstatement proceeding, we employ the review process applicable to
disciplinary actions before the Court. Said
process involves
[**4] a de novo examination of all matters
tendered before the Court. The Hearing Officer's findings, in this instance findings
adopted by a majority of the Commission, receive emphasis due to the unique
opportunity for direct observation of witnesses, but they are not binding, and
this Court reserves the right to reach the ultimate determination.
In re Gemmer (1991), Ind., 566 N.E.2d 528;
In re Kern (1990), Ind., 555 N.E.2d 479.
On September 6, 1985, this Court accepted Petitioner's
resignation from the Bar
tendered pursuant to Admission and
Discipline Rule 23, Section 17, and concluded as moot the
disciplinary action pending against him at that time.
In re Gutman (1985), Ind., 482 N.E.2d 456.
The basis of the
disciplinary complaint was criminal conduct culminating in a guilty verdict by
a jury in the United States District Court for the Southern District of Indiana
of conspiracy to commit extortion and interference with commerce by extortion,
in violation of
18 U.S.C. § 1951. The opinion of the United States Court of Appeals, Seventh Circuit, which
affirmed Petitioner's
[**5] conviction, set out the circumstances surrounding the underlying crime.
U.S. v. Gutman, 725 F. 2d 417 (7th Cir. 1984).
During the time in question, the Petitioner was the President Pro Tem of the
Indiana Senate. The case grew out of the efforts of the Indiana
Railroad Association to get Indiana's
"full crew" law repealed. In 1972, the Indiana Senate passed a bill to this effect which
became law. Sometime in 1973, an arrangement for
"something in return" was effectuated between the executive director of the Indiana
Railroad Association and three members of the
Indiana Senate, one of whom was the Petitioner. The
"something in return" was $ 1,000 per month for five years, to be split among the three
senators. The payments were a precondition to the
senators' assisting the
railroads in getting favorable legislation in the future. The payments were made from
1973 to 1976. Each $ 1,000 check was sent to one of the
senators who then sent checks for $ 333 to Petitioner and the third co-conspirator. The
Petitioner deposited his checks in a personal account rather than in the
account of his law partnership. The prosecution was allowed to present evidence
regarding
[**6] a $ 40,000 check from the Association to Petitioner, although this was not
part of the charges. This check the Petitioner again deposited in a personal
account and did not report as partnership income. According to a
railroad president's testimony, the payment was a bribe or payoff for other assistance
rendered by
[*607] the Petitioner to the
railroads, although the petitioner claimed that this fee was for legal services.
The
disciplinary complaint charged the Petitioner with engaging in illegal conduct involving
moral turpitude and conduct which adversely reflects on his
fitness to practice law, in violation of
Disciplinary Rules 1-102(a)(1), (3) and (6); with using his public position to obtain a
special advantage in legislative matters and
accepting a thing of value when he knows that it is for the purpose of influencing his
action as a public official, in violation of 8-101(A)(1) and (3); and
accepting private employment in a matter in which he had substantial responsibility
while he was a public employee and stating or flying that he is able to
influence improperly or upon irrelevant grounds a legislative body in violation
of 9-101(B) and (C) of the Code of Professional Responsibility
[**7] for Attorneys at Law.
Petitioner
tendered his
resignation after all appeals of his criminal conviction had been exhausted although he
had already made arrangements with his law firm to wind down his professional
responsibilities.
As a result of the conviction the Petitioner served approximately ten months in
the Federal Penitentiary at Terre Haute, Indiana. Since October 7, 1985, he has
been employed in the public finance department of a corporation where he
develops projects and makes presentations in the tax exempt investment banking
field almost exclusively to public service entities.
The unchallenged findings establish that more than five years have
elapsed since the order
accepting Petitioner's
resignation; that he has paid all costs, and that he has substantially complied with the
provisions of Admis. Dis. R. 23(26) and (27) requiring notice to clients. Under
the specifically enumerated elements of Rule 23(4)(b), the findings establish
that the petitioner desires in good faith to obtain
restoration of his privilege to practice law; he has not practiced law in this
state since the order
accepting his
resignation; he has complied fully with the terms of the Order
Accepting
Resignation;
[**8] and his conduct since the
discipline was imposed has been
exemplary and above reproach.
Petitioner points out that the evidence in support of the latter issue is
substantial. As part of this
reinstatement process, the
Disciplinary Commission sought input from the local Bar. In response, 21 letters were
submitted, 19 of which strongly supported the
reinstatement while two objected because of Petitioner's conviction for crimes concerning
breach of the
public trust. In addition, several witnesses testified favorably on behalf of the Petitioner
on this point. Petitioner argues that this evidence of
exemplary conduct since his removal from the Bar, or
"clean time," conclusively establishes his
rehabilitation and professional
fitness.
In examining
fitness to practice law, this Court exercises its duty to assure the public that those who hold
licenses to
provide service can be trusted to do so in a responsible and competent way. We
consider whether an attorney can be trusted to keep his client's secrets, give
effective legal advice, fulfill his obligations to the courts, and so on.
In re Oliver (1986), Ind., 493 N.E.2d 1237.
Exemplary behavior since the
misconduct
[**9] is one of several elements which must be proved in order to successfully
establish professional
fitness after
discipline. In addition, Admis. Dis. R. 23(4)(b) and particularly subsection (4)(b)(7)
require a close analysis of a range of relevant issues. Because a petitioner
for
reinstatement comes before us with a record of impaired professional
fitness, he must prove that he has overcome those weaknesses which produced the earlier
misconduct, has been rehabilitated, and is now trustworthy. See
In re Rosellini (Wash. 1987) 108 Wash. 2d 350, 739 P.2d 658, 660;
In re Brown (W. Va. 1980) 166 W.Va. 226, 273 S.E.2d 567, 570. Such petitioner bears a heavier burden than one who must prove
fitness at an initial admission to the Bar. A petitioner for
reinstatement must undergo a more exacting scrutiny, and a more rigorous showing of
professional moral character is required for purposes of
reinstatement than for original admission to
[*608] the Bar. See
In re Wegner (Minn. 1987) 417 N.W.2d 97, 99 ;
State v. Russo (Kan. 1981) 230 Kan. 5, 630 P.2d 711, 714;
In re Raimondi (Md. 1979) 285 Md. 607, 403 A.2d 1234, 1240.
[**10]
The present
fitness to practice law of an attorney
seeking
reinstatement must be considered in light of the offenses for which the petitioner was
disciplined.
In re Wegner, supra at 100; In re Brown, supra at 572. Indeed, a proper analysis under Admis. Dis. R.
23(4)(b)(7) would necessarily include, among other factors, n1 an examination
of the nature of the
misconduct for which the Petitioner was
disciplined. This position is consistent with the standards for readmission prevalent in
the majority of other jurisdiction where it is generally agreed that in
assessing an application for
reinstatement consideration must be given to the nature of the original offense.
In re Brown, supra; also see
In re Pool, supra;
In re Wegner, supra;
State v. Russo, supra;
In re Smith, supra;
In re Rosellini, supra;
In re Fleischman, supra;
In re Raimondi, supra.
- - - - - - - - - - - - - - - - - -Footnotes- - - - - - - - - - - - - - - - - -
n1 Other jurisdictions have enumerated several relevant factors to be
considered in determining
reinstatement. See generally,
In Re Fleischman (Ill. 1990) 135 Ill. 2d 488, 553 N.E.2d 352, 355, 142 Ill. Dec. 838 ;
In Re Pool (Mass. 1988) 401 Mass. 460, 517 N.E.2d 444, 447;
In Re Wegner, supra at 99; In Re Rosellini, supra at 660; State V. Russo, supra at 714;
In Re Smith (W. Va. 1980) 166 W.Va. 22, 270 S.E.2d 768, 770;
In re Brown, supra; In Re Raimondi, supra at 1234. Among them are:
1. The nature of the underlying
misconduct;
2. Petitioner's maturity and experience at the time of
misconduct;
3. The presence of physical or psychological illness or
other extenuating circumstances which were susceptible to correction or change;
4. The nature and extent of any resulting consequences on
public confidence in the administration of justice and the integrity of the system;
5. Specific conduct subsequent to the
misconduct, including petitioner's attitude toward the
misconduct, a demonstrated consciousness of the wrongfulness of his conduct and an
attitude of
genuine
remorse;
6. The time
elapsed since the sanction;
7. Good faith attempt at
restitution;
8. Petitioner's present character and
competence in the law.
- - - - - - - - - - - - - - - - -End Footnotes- - - - - - - - - - - - - - - - -
[**11]
In
assessing the original
misconduct we examine the nature and effect of the resulting consequences and the impact
Petitioner's acts had on the public's confidence in the administration of
justice and the integrity of the legal system. The view that
reinstatement must be determined in part by ascertaining its impact on
public confidence in the administration of justice and the integrity of the legal system has
been expressed by many other jurisdictions. See In re
Brown, supra at 570; see also In re Pool, supra at 449. It is also one of the
enumerated factors considered by this court in
assessing
disciplinary sanctions.
In re Gemmer (1991), Ind., 566 N.E.2d 528;
In re Kern (1990), Ind., 555 N.E. 2d 479;
In re Hampton (1989), Ind., 533 N.E.2d 122.
We agree with the view that this examination is a balancing process in which on
one side of the scale we place the
seriousness of the
misconduct and on the other, Petitioner's subsequent conduct and his present character.
Raimondi, supra at 1239. The more
[**12] serious the
misconduct, the greater its negative impact on future
rehabilitation and eventual
reinstatement, the greater Petitioner's
burden of proof to overcome the implication of unfitness which is conjured by the
misconduct. See generally
In re Barton, (Mo. 1974) 273 Md. 377, 329 A.2d 102, 104; In re Raimondi, supra at 1235, 1237. The
seriousness of past
misconduct is unquestionably an important consideration which cannot be eliminated by
subsequent
exemplary conduct. In re Fleischman, supra at 355. As noted by the Commission, this
Court's decision denying
reinstatement in
In re Beck (1976), Ind., 264 Ind. 141, 342 N.E.2d 611, supports the proposition that a conviction for a crime involving moral
turpitude carries
great weight even though there is a subsequent pardon. Conversely, where the original
misconduct is of lesser severity, Petitioner's burden to prove
rehabilitation is met more easily, and subsequent
"clean time" carries
great weight.
[*609] We see no useful purpose for a per se distinction based upon the sanction or
the method whereby the sanction was imposed, i.e.,
resignation,
[**13] agreement or contested
hearing. The range of sanctions, including disbarment and
resignation upon admission of
misconduct, is relevant only indirectly to the extent that it reflects the severity of the
underlying
misconduct. Although not determinative, the sanction could serve as a guidepost in the
evaluation of the underlying
misconduct and the relative weight such
misconduct receives. To the extent that suspension for a period of time reflects the
relative
seriousness of the
misconduct, it carries an implication that the Respondent could be rehabilitated. Such a
petitioner would have an easier burden of proving professional
rehabilitation and
fitness for return to practice than would a disbarred petitioner. Disbarment brings to
mind an implication of unfitness far less subject to
rehabilitation.
A
resignation pursuant to admission of guilt indicates that the Petitioner was cognizant of
his
misconduct and was willing to spare himself and the system the burdens of a full
proceeding. A
resignation, however, will not render the admitted
misconduct less serious than a judicial determination of the same conduct.
n2
- - - - - - - - - - - - - - - - - -Footnotes- - - - - - - - - - - - - - - - - -
n2 In his Affidavit of
Resignation, which was submitted pursuant to Admission and
Discipline Rule 23, Section 17, the Petition acknowledged that he could not present a defense.
The rule requires such an admission, in part, because the alleged
misconduct is contemplated as a factor in the event of future petition for
reinstatement.
- - - - - - - - - - - - - - - - -End Footnotes- - - - - - - - - - - - - - - - -
[**14]
Reviewing the findings of this case, we note that at the inception of the
payments the Petitioner had been a successful practicing attorney for in excess
of 15 years. He was an experienced, respected lawyer who had attained a rare
and powerful position as President Pro Tem of the Indiana Senate. He used this
office to extort money and his legal practice to disguise the extorted
payments. This was not a random or isolated event, but a calculated scheme
which continued on a monthly basis over five years. There is no evidence of
physical or psychological illness or other extenuating circumstances which are
susceptible to correction or change. All this leads us to the inescapable
conclusion of Petitioner's extensive culpability.
Petitioner's crime was notorious and scandalous. It is one which strikes at the
very heart of
public trust in our institutions of government and the
legal profession. It brought disrepute to the
legal profession and erosion of
public confidence in our system of government. The extremely serious nature of Petitioner's
misconduct, the calculated and deliberate manner in which he extorted money for a long
period of time, the betrayal of the
public trust, and the
[**15] substantial adverse affect on the integrity of a government institution
present the Petitioner with a heavy burden to overcome the profound lack of
moral character demonstrated by such acts.
Coupled with this factor is the Hearing Officer's assessment that Petitioner
failed to demonstrate
genuine
remorse. The Petitioner testified that he regrets that he has not lived up to his own
high standards for personal and professional conduct, and in so doing, has hurt
himself, his wife, his
children, his law partners, the General Assembly and the
legal profession. The Hearing Officer determined that the fact remains that the Petitioner has
no explanation for his
misconduct and does not admit anything other than the use of poor judgment. The Hearing
Officer found there was no apology, no offer of
restitution to those whom Petitioner wronged, but only Petitioner's regret over how things
had turned out for him. The Commission further found that the lack of
restitution had an adverse impact on the assessment of
remorse as well as their assessment of Petitioner's appreciation of the wrongfulness
of his conduct.
Issues of mental state, such as
remorse, often are not easily discernible. However,
[**16] certain ostensible factors such as apology and concerted effort at
restitution can provide strong indication of a remorseful state of mind. Although not a
controlling consideration, whether
restitution has
[*610] been made is relevant to the determination of
rehabilitation. Failure to make
restitution without justification has been considered a strong
indication of lack of
rehabilitation. In re Pool, supra at 448.
These observations led the Hearing Officer and the majority of the Commission
to conclude that the Petitioner
failed to demonstrate
genuine
remorse,
failed to demonstrate a proper understanding of the standards that are imposed upon members of the
Bar, and that it is not clear that he will conduct himself in
conformity with such standards in the future, as required by Admis. Dis. R. 23(b)(4) and
(6).
To challenge this, the Petitioner points to the testimony of two witnesses, one
indicating that the Petitioner has been extremely remorseful, embarrassed, and
saddened at his own conduct, and one indicating that the Petitioner has
accepted personal accountability in a uniquely gracious way. In addition,
Petitioner points to two affidavits submitted as
[**17] evidence in which the affiants refer to his
remorse. As stated earlier, the Hearing Officer's findings are not binding but her
assessment of all evidence and her judgment in reconciling
inconsistent evidence carries
great weight because of her unique opportunity to observe the witnesses. See
In Re Kern, supra.
Finally, a majority of the Commission concluded that the Petitioner failed to
prevail in his
burden of proof on the issue of professional
competence. The Petitioner, who, at the time of the hearing had not practiced for almost
eight years, testified that he attended seminars on federal tax law changes,
municipal law, construction industry issues, and read the ABA magazine.
Undoubtedly, evidence of compliance with Admission and
Discipline Rule 29 concerning mandatory continuing legal education and with Admission and
Discipline Rule 23(b)(9) concerning the Multistate Professional Responsibility Examination
(MPRE) (which on January 1, 1992, became mandatory for persons seeking
readmission) would have been extremely persuasive on this issue. However, we
are not convinced that the lack of such showing in this instance necessarily
precludes a finding
[**18] of professional
competence
in the law.
Having carefully examined all matters presented in this petition for
reinstatement and with the foregoing considerations in mind, we find that the Petitioner has
failed to meet his
burden of proof under Admis. Dis. R. 23(4)(b)(4), (6) and (7). Accordingly, the
recommendation of the
Disciplinary Commission is accepted, and the petition for
reinstatement is denied.
