OLR seeks to suspend Madison lawyer for 60 days

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A Madison attorney who the Office of Lawyer Regulation says charged excessive fees to a client and continuously failed to provide an invoice is facing a 60-day suspension of her law license.

Kathleen Wagner was hired by her client, Wendalee Graves, to work on some estate and trust planning. When she was hired in April 2008, the agreement stated that Wagner would charge $250 an hour, according to an Oct. 31 complaint filed by the OLR. Graves gave her a $500 check, which Wagner did not put into a trust account, according to the complaint.

However, while working for Graves, Wagner allegedly kept no time or billing records, according to the complaint. About six months later, though, Graves gave Wagner an additional $6,500, and she deposited that check and the one for $500 into a trust account at the same time.

In January 2009, she wrote in a letter that, as they had discussed in September 2008, her hourly fee was going to increase to $350, despite that being the earliest “written communication” about the subject.

According to the complaint, Wagner finished her work in January 2009 but had not yet prepared an invoice. The following month, Graves died.

In November 2009, the trustee to the estate, Jonathan Graves, sent an email to Wagner inquiring about the bill for her work. The amount was disputed, though, and Jonathan Graves and Wagner agreed to set aside $167,000 for the disputed fees, according to the complaint.

The disputed fees led to an attempt for arbitration by the State Bar and two lawsuits. Meanwhile, while sending letters describing the fees paid, Wagner still did not provide a billing invoice, according to the complaint. She also admitted that she never put the fee increase in writing and said during a deposition that “you don’t have to have it in writing in Wisconsin,” the complaint states.

In January 2012, Wagner provided an invoice for $86,877.30. In April 2013, after a trial, Dane County Circuit Judge Richard Niess awarded her $65,029.80. In an oral ruling, he said that her representation agreement “was about as bad as I’ve seen” and it was “bothersome” and “very poor practice” that Wagner did not provide periodic bills or time records.

Wagner faces three counts of misconduct.

She graduated from the University of Wisconsin Law School in 1983. Her law license is in good standing, according to the State Bar’s website.

Reached by phone Tuesday, Wagner said she is “quite surprised” by the complaint. She maintained that she clearly told her client that her fee was going to be increased, even if it wasn’t put into writing. She also said she held onto the $500 check for six months because there was some question over whether she was going to continue to represent Wendalee Graves.

She also pointed out that the money given to her was always put into a trust account, and that none of it was mismanaged.

“I’m dumbfounded,” Wagner said. “How can you be in violation of something that’s been in trust at all times?”

“It simply meant I was conservative on how much I … needed set aside and stay in trust,” Wagner said. Follow @eheisigWLJ