Hello everyone and welcome to this JACPA Ethics Alert blog which will discuss the recent Florida Supreme Court per curiam Order which, by a 4-3 vote, reinstated a lawyer to practice who apparently willfully failed to file income tax returns for the years 2007 and 2008 until early 2010 and failed to timely file the returns because knew that did not have the money. Justice Canady wrote a strong dissent arguing that the lawyer failed to show his fitness to practice and rehabilitation by clear and convincing evidence. The case is: The Florida Bar v. Hudson —So.3d—, 2011WL 4835808 (No. SC10-329 Fla. October 6, 2011).
Justice Canady’s dissent states that the lawyer was voluntarily placed on the Bar’s inactive list for incapacity unrelated to misconduct on August 16, 2005 and at that time; he was under a three-year term of probation for a prior disciplinary offense. At the hearing before the referee, the lawyer admitted that he did not file income tax returns for the years 2007 and 2008 until early 2010 but that he filed the returns “in conjunction with the filing of [his] petition” for reinstatement.
The lawyer also admitted that he knew he had an obligation to file his tax returns each year and that he failed to timely file the returns because he “knew [he] did not have the money to pay” the taxes that he owed. He offered no reason why he did failed to request an extension or a payment plan when the taxes were due or state that he was exempt from filing a tax return for those years.
The referee recommended that the lawyer be reinstated and The Florida Bar argued on review that the lawyer failed to prove his rehabilitation and fitness to practice by clear and convincing evidence and his conduct related to the failure to file the tax returns was disqualifying.
In his dissent, Justice Canady stated that the lawyer’s willful failure to file income tax returns for the years 2007 and 2008 was affirmative evidence of both unlawful conduct and financial irresponsibility. He also pointed out that willful failure to file a tax return is a misdemeanor offense and the comment to Bar Rule 4-8.4 expressly notes that the “willful failure to file an income tax return” is “illegal conduct [that] reflect[s] adversely on fitness to practice law.”
According to Justice Canady, “(c)ontrary to the referee’s determination, (the lawyer’s) willful disregard of his obligation to file income tax returns is disqualifying conduct. This flouting of the federal income tax law is serious misconduct which should preclude “(the lawyer’s) reinstatement until he has demonstrated rehabilitation.” Further, “(the lawyer’s) disregard of his obligation to file his tax returns was part of a pattern of misconduct” and the lawyer received a three-year period of probation for misconduct in 2005 and received a minor misconduct and served jail time for an incident of “road rage” that occurred in April 2006.
Bottom line: This is an interesting recent lawyer discipline Order of the Supreme Court of Florida on multiple levels. First, the Court approved the referee’s recommendation to reinstate the lawyer on a narrow 4-3 vote with Justices Pariente, Quince, LaBarga, and Perry voting to reinstate and Justices Lewis and Polston joining Justice Canady’s dissent. Second, since there is no majority opinion, the underlying rationale of the majority is unknown and the vote to reinstate could either be because the majority did not find the conduct to be disqualifying or that the other mitigation and rehabilitation evidence was sufficient to overcome the prior conduct (or some other reason or reasons). Finally, Justice Canady’s dissent is very strongly worded and there is no majority opinion to counter his arguments and observations, which will not be precedential.
…be careful out there!
As always, if you have any questions about this Ethics Alert or need assistance, analysis, and guidance regarding these or any other ethics, risk management, or other issues, please do not hesitate to contact me.
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