NO. 91-250
IN THE SUPREME COURT OF THE STATE OF MONTANA
1990
IN THE MATTER OF THE VERIFIED PETITION FOR REVIEW OF THE DECISION
OF THE CHARACTER AND FITNESS COMMITTEE ON THE APPLICATION OF
KENNETH J. PEDERSEN.
ORIGINAL PROCEEDING:
COUNSEL OF RECORD:
For Petitioner:
Kenneth J. Pedersen, Pro Se, Boise, Idaho.
For Respondent:
Max A. Hansen; Hansen &Associates, Dillon, Montana.
Submitted on briefs: August 15, 1991
14, 1991
CLCS
s
Justice William E. Hunt, Sr., delivered the opinion of the Court.
Petitioner Kenneth J. Pedersen appeals from the final decision
of the Committee on Character and Fitness of the State Bar of
Montana refusing to certify petitioner to this Court for admission
to the Montana Bar. We affirm the decision of the Committee.
We phrase the issues before this Court as follows:
1. What is the appropriate standard of review for this Court
to apply in reviewing a final decision of the Committee on
Character and Fitness of the State Bar of Montana?
2. Did the Committee on Character and Fitness violate
petitioner's constitutional right to due process?
3. Did the Committee on Character and Fitness err in finding
that petitioner does not possess the requisite good moral character
required for certification for admission to the Montana Bar?
On April 13, 1989, petitioner filed an application for
admission to the State Bar of Montana. As is the case with all
applications to the Montana Bar, petitioner's application was
referred to the Committee on Character and Fitness for review.
Upon review, the Committee, on May 30, 1989, refused to certify
petitioner to this Court to take the Montana Bar Examination.
Petitioner requested the Committee reconsider its decision.
Following an informal hearing on July 25, 1989, which petitioner
attended, the Committee reaffirmed its initial decision denying
petitioner's application for admission. Petitioner then requested
a formal hearing on the matter. On May 4, 1990, the Committee held
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a formal hearing at which petitioner personally appeared without
counsel. Petitioner presented evidence on his behalf and responded
to questions by the Committee members. On April 9, 1991, the
Committee issued its Findings of Fact, Conclusions of Law and Final
Decision, again refusing to certify petitioner to this Court for
admission to the Montana Bar. Petitioner appealed the Committee's
final decision by filing with this Court a Verified Petition for
Review pursuant to Section 4(i) of the Rules of Procedure of the
Committee on Character and Fitness of the State Bar of Montana.
At the time of petitioner's application for admission to the
Montana Bar, he had been a member of the State Bar of Illinois
since 1980, an affiliate member of the State Bar of Idaho since
1982, and had been admitted to practice before the United States
Patent Office since 1980. Upon receiving petitioner's application,
the Committee undertook an extensive investigation of petitioner's
background. The findings of this investigation raised serious
questions concerning petitioner's moral character in relation to
his application for admission to the Montana Bar. Specifically,
the Committee was concerned by an apparent pattern of neglect of
financial responsibilities and professional obligations by
petitioner. The Committee discovered that petitioner was the
subject of a number of debt collection actions, one involving a
lawsuit. Additionally, it was learned that several complaints
against petitioner were filed in Illinois with the Attorney
Registration and Disciplinary Commission and that petitioner was
3
the defendant in a legal malpractice action in Illinois. After
extensive investigation, deliberation, and three separate hearings
on the matter, the Committee ultimately denied petitioner's
application.
I.
What is the appropriate standard of review for this Court to
apply in reviewing a final decision of the Committee on Character
and Fitness?
The present appeal appears to be the first case in which an
applicant for the Montana Bar has sought review of a final decision
of the Committee on Character and Fitness. Inasmuch as this is a
case of first impression, we must determine the appropriate
standard of review to apply in reviewing decisions of the Committee
on Character and Fitness. The Committee has been given the
authority to "act on behalf of this Court to investigate and
determine the moral character and fitness of each applicant to take
the Montana Bar Examination." Rules For Admission to the Bar
(1988), 234 Mont. 1, 9. (This Court recently issued new rules
regarding admission to the Montana Bar which became effective in
January 1991. Rules For Admission To The Bar (Mont. 1991),
48 St.Rep. 30. However, since petitioner's application was denied
in 1990, this case is governed by the 1988 rules.)
The Montana Constitution provides that this Court has the
power and obligation to regulate the admission of attorneys to the
Montana Bar. Mont. Const. art. VII, § 2, cl. 3. The Committee on
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Character and Fitness assists this Court in fulfilling its
obligation to regulate the admission of attorneys in Montana.
However, the ultimate decision regarding the admission of attorneys
in Montana rests exclusively with this Court. Upon reviewing a
final decision of the Character and Fitness Committee we will
conduct an independent review of the entire record to determine if
the Committee erred. When the facts are admitted and uncontested,
as they are in this case, we will give due consideration to the
inferences drawn by the Committee, including inferences concerning
rehabilitation and mitigation. Consideration will be given to the
recommendation of the Committee as to whether the applicant is of
the requisite good moral character and fitness to be admitted to
the Montana Bar. The Committee will have heard testimonial
evidence and will have had the opportunity to observe the demeanor
and judge the credibility of the applicant or other witnesses.
However, inasmuch as we are designated by the Montana Constitution
to ultimately make this decision, we will affirm the Committee's
recommendation if we determine it was correct, and we will reverse
if we feel the Committee erred. Our review will be in accordance
with the existing standards for admission, taking into
consideration the whole record.
11.
Did the Committee on Character and Fitness violate
petitioner's constitutional right to due process of law?
5
Petitioner asserts a violation of his right to due process by
the Committee. Petitioner maintains that in light of the evidence
presented, the decision of the Committee was arbitrary and based
upon considerations that offend the dictates of reason.
In matters relating to the admission of attorneys to the
Montana Bar, and the conduct of members of the bar, this Court's
power is both broad and exclusive. The Montana Constitution
provides that this Court:
[Mlay make rules governing appellate procedure, practice
and procedure for all other courts, admission to the bar
and the conduct of its members. Rules of procedure shall
be subject to disapproval by the legislature in either of
the two sessions following promulgation.
Mont. Const. art. VII, 5 2, cl. 3. We have consistently held that
the clear and unambiguous language in our Constitution gives this
Court exclusive authority to regulate the admission and conduct of
attorneys in Montana. In the Matter of the Petitions of McCabe and
Zeman (1975), 168 Mont. 334, 339, 544 P.2d 825, 827-28; Harlen v.
City of Helena (1984), 208 Mont. 45, 49, 676 P.2d 191, 193. Prior
to the 1972 Constitution, it was already recognized that the power
to regulate the admission of attorneys in Montana was a matter
peculiarly within the inherent power of this Court. Goetz v.
Harrison (1969), 153 Mont. 403, 404, 457 P.2d 911, 912.
However, this power is subject to limits imposed by the
Federal Constitution. A s the United States Supreme Court has said:
A State cannot exclude a person from the practice of law
or from any other occupation in a manner or for reasons
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that contravene the Due Process or Equal Protection
Clause of the Fourteenth Amendment.
Schware v. Board of Bar Examiners (1957), 353 U.S. 232, 238-39, 77
S.Ct. 752, 756, 1 L.Ed.2d 796, 801. Those bodies charged with
investigating and making decisions upon an applicant's character
and fitness to practice law in a particular jurisdiction must
afford the applicant adequate due process of law. Mr. Justice
Frankfurter, concurring in Schware, stated that "[r]efusal to allow
a man to qualify himself for the profession on a wholly arbitrary
standard or on a consideration that offends the dictates of reason
offends the Due Process Clause." Schware, 353 U.S. at 249. In a
later opinion, the United States Supreme Court reiterated that
arbitrary or capricious denials of bar applications will not be
tolerated. The Court added that the right to engage in the
practice of law is not and should not be a matter of grace and
favor. Willner v. Committee on Character and Fitness (1963), 373
U.S. 96, 83 S.Ct. 1175, 10 L.Ed.2d 224. In a concurring opinion in
Willner, Mr. Justice Goldberg discussed the due process requirement
in these cases:
The constitutional requirements in this context may be
simply stated: in all cases in which admission to the bar
is to be denied on the basis of character, the applicant,
at some stage of the proceedings prior to such denial,
must be adequately informed of the nature of the evidence
against him and be afforded an adequate opportunity to
rebut this evidence.
Willner, 373 U.S. at 107.
7
The Committee on Character and Fitness has adopted specific
rules of procedure to be followed in reviewing applications for the
Montana Bar. These rules, which were reviewed and approved by this
Court in 1987, provide for various procedural due process
safeguards. In addition, this Court, in fulfilling its
constitutionally mandated duty to regulate the admission of
attorneys in Montana, promulgated a comprehensive set of rules and
procedures governing the admission of attorneys to the Montana Bar.
Rules for Admission to the Bar (1988), 234 Mont. 1. Section IV of
the rules issued by this Court specifically discusses the Committee
on Character and Fitness and the process by which it shall review
applications for the Montana Bar.
In the instant case, these rules governing the procedure of
the Committee and providing for due process for applicants were
followed. Early on in the process, the Committee communicated to
petitioner its specific concerns. Petitioner was aware of the
instances of conduct which the Committee was investigating.
Petitioner had ample opportunity to then produce any evidence or
witnesses he desired in order to rebut the evidence offered against
him. The Committee held three separate hearings on this matter,
two of which petitioner personally attended. Petitioner was
informed that he had the right to counsel at these hearings. Upon
reaching a decision, the Committee issued detailed findings of fact
and conclusions of law specifically noting the bases for its
decision. It is clear the procedure was followed, and that the
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constitutional requirements of due process were met. We hold that
petitioner's right to due process of law was not violated by the
Committee.
111.
Did the Committee on Character and Fitness err in finding
petitioner does not possess the requisite good moral character
required for certification for admission to the Montana Bar?
In addition to describing the duties of the Committee and the
procedure to be followed, in 1988 this Court set out the standard
to be used by the Committee in determining if an applicant is
possessed of the required good moral character for admission to the
Montana Bar.
3. Standard of Character and Fitness. Every applicant
for the Montana Bar Examination must be of good moral
character. Good moral character shall be oresumed by the
Committee on Character and Fitness and thereafter
certified to the Clerk of Court unless prior or present
conduct of the applicant of which the Committee becomes
aware would, in the opinion and discretion of the
Committee, cause a reasonable person to believe that such
applicant would, if admitted to practice law in Montana,
be unable or unwilling to act in accordance with the
standards set forth in the Montana Rules of Professional
Conduct, fairly, honestly, reasonably, and with
unquestioned integrity in all matters in which he or she
acts as an attorney at law. [Emphasis added.]
Rules for Admission to the Bar (1588), 234 Mont. 1, 5. This
standard differs from that adopted by the Committee and approved by
this Court in 1987. The Committee's rule provides that every
applicant shall be of good moral character, but then goes on to say
that "[tlhe applicant shall have the burden of proving that he or
she is possessed of good moral character. The Committee shall
certify the Applicant to the Clerk of the Supreme Court unless
prior or present conduct . . . . 'I Rules of Procedure of the
Committee on Character and Fitness of the State Bar of Montana,
g 3(a) (1987). The 1991 Rules for Admission issued by this Court
are in accord with the 1987 Committee Rules in providing that the
applicant has the responsibility of proving his or her moral
character to the satisfaction of the Committee. However, the 1988
rules indicate that the good moral character of the applicant is to
be presumed. To the extent that the Committee Rules are
inconsistent with our 1988 rules on this point, the Committee Rules
are superseded in this case which is governed by the 1988 rules.
The Committee initially placed the burden on petitioner to
prove his good moral character in this case. To that extent the
Committee erred. However, the Committee specifically found that
past conduct of petitioner would cause a reasonable person to
believe petitioner would be unable or unwilling to act in
accordance with the standards set forth in the Montana Rules of
Professional Conduct. Therefore, even presuming petitioner's good
moral character, this conclusion justifies the Committee's ultimate
decision.
Pursuant to Sections 3(c)(7) and 3(c)(8) of the Committee
Rules, discovery of evidence tending to show neglect of financial
responsibilities and neglect of professional obligations is cause
for further inquiry before certifying the applicant. In this
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instance, after extensive investigation the Committee concluded
that the seriousness of the past conduct required it to deny
petitioner's application. The Committee concluded that the
circumstances surrounding petitioner's past conduct were prima
facie evidence of a violation of Rule 1.1 and Rule 1.3 of the
Montana Rules of Professional Conduct. The Committee found the
past conduct was not mitigated by any of the factors or
circumstances which provided the background for the conduct.
Additionally, the Committee found insufficient evidence or history
of rehabilitation to warrant overlooking the described conduct.
Petitioner did present evidence indicating that for the past
several years he has acted responsibly in relation to both
financial and professional obligations. This is at least some
indication of rehabilitation on the part of petitioner. However,
after examining the record as a whole, we cannot say that the
Committee erred in determining that petitioner is not possessed of
the requisite good moral character required for admission to the
Montana Bar. We hold that the Committee did not err in denying
petitioner's application. The decision of the Committee is
affirmed.
. ,
Justice
We concur:
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November 14, 1991
CERTIFICATE OF SERVICE
I hereby certify that the following order was sent by United States mail, prepaid, to the following
named:
Kenneth J. Pedersen
P.O. Box 293
Boise, ID 83701-0293
Annie M. ~ a r t o s 1
Committee on Character and Fitness
P.O. Box 1051
Helena, MT 59624
Barbara Bell r
Committee on Character and Fitness
Ste. 201, Liberty Center
#9, 3rd St. No.
Great Falls, MT 59401
Betsy Brandborg
Committee on Character and Fitness
6582 Canyon Ferry Rd.
Helena, MT 59601
Max Hansen
Hansen & Associates
P.O. Box 1301
Dillon, MT 59725
ED SMITH
CLERK OF THE SUPREME COURT
STATE OF MONTANA
BY:
Deputy