Starting next year, Wisconsin lawyers will have one more fixed assessment on their annual dues statements.
The state Supreme Court voted unanimously recently to adopt a consistent $20 yearly fee to support the struggling Wisconsin Lawyers’ Fund for Client Protection, which pays out claims to clients who are victims of attorney misconduct.
Currently, the more than 22,000 attorneys licensed to practice in the state pay a fluctuating amount between zero and $25 each year to cover the cost of projected claims.
But a change was sought after a dramatic rise in claim amounts during the last few years which forced the WLFCP to defer payments.
“When I read your annual report, mentally I declared you in bankruptcy,” Chief Justice Shirley Abrahamson told the WLFCP committee vice chair during the April 11 public hearing on the issue.
During the past five years, the average annual WLFCP assessment was $16, although the amount rose to $25 for fiscal year 2010 and the same will be assessed this fiscal year. Outstanding claims currently amount to more than $800,000.
According to Lindsey Draper, vice chair of the WLFCP committee, the consistent charge was sought to eventually build up a surplus should the dollar amount of claims continue to escalate.
“Part of what is difficult to know is how one or two lawyers can devastate things like the fund,” he said. “Essentially, that makes the other lawyers look bad.”
The fund faced several large claims last year, including a $150,000 payout to Bethany Evangelical Lutheran Church, one of four claims against an attorney that resulted in more than $380,000 in client reimbursements.
Justice David Prosser questioned that if claim amounts continue to rise, whether the committee would seek an increase in the annual assessment beyond $20, something which he is not in favor of.
He told the other justices that he has no intention of being one of four votes that would be needed to increase the assessment in the future.
“Don’t come back and expect me to vote for $25 ever. Ever,” Prosser said.
In an interview, Draper emphasized that the committee has no intention of returning to the court to ask for an increase.
The court will review the status of the fund in five years to determine whether any changes are needed, which could even include a reduction in the assessment, Draper said, should claim amounts trend downward.
“Clearly, our intent is not to come back,” he said. “If we created a huge reserve fund, it is just as possible to have the amount lowered.”
The $20 assessment is expected to generate approximately $450,000 annually for the fund, which cannot be used as general purpose revenue by the State Bar of Wisconsin.
Justice Michael Gableman expected the fund would eventually develop a surplus and suggested the $20 charge builds in “padding” for the WLCFP.
He said a $17 assessment would have been more in line with the average for the last five years, but he said it is better than the $25 maximum which is currently being assessed.
“It’s probably not the worst thing to add some padding,” he said.
Jack Zemlicka can be reached at firstname.lastname@example.org.