Court to suspend GF lawyer

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The state Supreme Court has decided to temporarily suspend a veteran Great Falls attorney -- along with censuring him and requiring him to cover the costs of his disciplinary proceedings -- for violating the rules that govern the ethical conduct of Montana attorneys.

The high court earlier rejected a recommendation to dismiss a complaint against Joseph Engel III, finding instead that he overcharged a 99-year-old client and mishandled $70,000 in retainer fees.

The Supreme Court's Commission on Practice, which handles complaints against attorneys, then held a hearing to determine the appropriate sanctions. It recommended public censure and payment of the costs of the disciplinary proceedings but said several mitigating factors weighed against harsher punishment.

In a 4-3 decision issued Wednesday, the Supreme Court declined to follow the commission's recommendations.

''We conclude that in addition to public censure and the obligation of the costs of the disciplinary proceedings, Engel's conduct warrants a 60-day suspension from practice,'' the high court wrote. Engel is scheduled to be censured on March 18, at which time his suspension will begin.

Engel, who has practiced law in Montana for more than 30 years, did not immediately return a phone call seeking comment Thursday.

In a unanimous decision in July, the high court said Engel charged Alice Kloss excessive hourly and contingency fees for legal services he provided from 1998 to 2005. Kloss died in April 2006.

Engel received about $295,000 in fees, which the high court called ''unreasonable.'' The Supreme Court also said the $70,000 in retainer fees Engel collected should have gone into a client trust account, rather than his operating account.

The Commission on Practice had recommended dismissing the complaint against Engel, saying there was no clear evidence to support the allegations.

But the Office of Disciplinary Counsel determined Engel had violated four provisions of the Montana Rules of Professional Conduct and opposed the commission's recommendation to dismiss the complaint.

The Supreme Court agreed with the Office of Disciplinary Counsel on two counts but rejected two others.

Engel had argued his fees were in line with the ''overall picture'' of his representation of Kloss, which included a variety of legal services. He had also claimed the retainers were exempt from rules requiring that all client funds be placed in a client trust account, saying the money represented ''soon-to-be-earned fees.''

Kloss, the childless widow of a Sun River Valley farmer, had nearly $1 million in assets when she fell and broke her hip in 1998 and moved into a Great Falls assisted-living facility. She later asked her nephew Kenneth Parrent to move from Colorado to help manage her affairs.

Court records show Kloss lost more than $800,000 while under the care of Engel and Parrent, who moved into her Fairfield home with his fiancee and was dependent upon Kloss for income. Parrent had unlimited power of attorney, and became sole trustee of Kloss' living trust, documents said.

A message left for a Ken Parrent in Fairfield on Thursday was not immediately returned.

In its recommendation to the Supreme Court, the Commission on Practice said several factors supported its decision not to pursue harsher sanctions against Engel, including the fact that Kloss never complained about his work or his fees.

The high court disagreed, saying Kloss never complained about Engel because Parrent had written all the checks for Engel's legal fees, so Kloss didn't know how much money she had paid Engel.

Wednesday's order was signed by justices Karla Gray, Brian Morris, John Warner and Jim Rice.

Justices William Leaphart, James Nelson and Patricia Cotter dissented.

''Given that the Commission on Practice has twice considered this matter and has had the benefit of hearing the witnesses firsthand, I would defer to the commission's recommendation that Mr. Engel be subject to a public censure and be responsible for the costs of the disciplinary proceedings,'' Leaphart wrote.

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