[¶ 1.] The Disciplinary Board of the State Bar of South Dakota filed a formal accusation against attorney Al Arendt pursuant to SDCL 16-19-67. The Board recommended that Arendt be suspended from the practice of law in the courts of South Dakota for a period of 120 days. Arendt admitted the allegations of the formal accusation and agreed to the sanction pursuant to SDCL 16-19-68. We conclude that suspension from the practice of law for a period of 120 days is an appropriate sanction.
[¶ 2.] Arendt graduated from law school in 1978. Upon his admission to the bar, he practiced law in Timber Lake for about seven years. Arendt then moved to Pierre, where he has been continuously engaged in private practice.
[¶ 4.] Arendt offered to create a joint venture. Arendt and his wife proposed to provide Wellner and his wife with the money necessary to purchase the real estate. The ultimate intent of the parties was to sell the property.
[¶ 5.] Before the joint venture agreement was to be executed, Arendt provided Wellner with a copy of Rule 1.8 of the Rules of Professional Conduct, which provides in relevant part:
In drafting the joint venture agreement, Arendt also included a provision setting out the advice required by Rule 1.8. However, the joint venture agreement was never executed because the parties could not agree on the manner in which the proceeds from the intended sale would be divided.
[¶ 6.] In the course of investigating the foregoing matter, the Disciplinary Board learned that in early 1995, Arendt had been retained by Wellner and Wellner's father, George, in connection with a mortgage foreclosure. At that time, George was indebted to the Farmers Home Administration (FHA), and the debt was secured by a mortgage on 560 acres of George's land.
[¶ 7.] At the time Arendt was retained, the foreclosure sale was pending. Arendt initiated a bankruptcy proceeding in order to stay the foreclosure sale, and he continued to represent George for several months during the bankruptcy. Arendt worked to resolve the matter in a way that would enable George to retain the property. Arendt negotiated an agreement with FHA that released the land from the judgment lien upon payment of the appraised value of the property.
[¶ 8.] Arendt then offered to provide the money to satisfy the FHA judgment, with the understanding that Steve Wellner, rather than George Wellner, would eventually purchase the land from Arendt. Arendt ultimately provided the funds, and title to the land was transferred to Arendt's spouse, who then entered into a contract for deed with Steve Wellner. The contract called for annual payments of principal and interest; however, Wellner did not make any payments. In 1999, the land was sold to a third party. At that time, Arendt was repaid his investment, plus some fees. The balance was retained by Steve Wellner.
[¶ 9.] In conducting its investigation, the Board decided to determine whether Arendt complied with the requirements of Rule 1.8 in the course of the 1995 transaction. In responding to the Board's inquiry,
[¶ 10.] Upon examination, the Board observed that the letter was different in style from other documents prepared by Arendt in August 1995. Particularly, the type font and the letterhead were different. The Board informed Arendt's counsel of its concerns about the authenticity of the letter, and it asked that Arendt be prepared to address this issue when he appeared before the Board.
[¶ 11.] Arendt's counsel advised Arendt of the Board's concern, and Arendt admitted to his counsel that he created the letter in an effort to mislead the Board. Arendt's counsel promptly advised the Board that the document was false. Arendt also admitted that the letter was false in his testimony before the Board. He was also remorseful.
[¶ 12.] After a hearing, the Board made findings, conclusions, and recommendations regarding the appropriate discipline. "Because [the Board] had the advantage of seeing and hearing the witnesses, this Court gives careful, due consideration to their findings." In re Discipline of Mattson, 2002 SD 112, ¶ 38, 651 N.W.2d 278, 285 (citations omitted). Ultimately, however, "[t]he final determination for the appropriate discipline of a member of the State Bar rests firmly with the wisdom of this Court." Id. (citation omitted).
[¶ 13.] Initially, we note that:
In re Discipline of Eicher, 2003 SD 40, ¶ 24, 661 N.W.2d 354, 363 (internal citations omitted).
[¶ 14.] The Disciplinary Board concluded that Arendt violated SDCL 16-18-26(1), which provides: "Every attorney at law who ... [p]ractices any deceit or collusion, or consents to the same with intent to deceive the court or any party; ... is guilty of a Class 2 misdemeanor." Moreover, the Board concluded that Arendt violated SDCL 16-18-19 concerning an attorney's obligation to use only truthful means. That statute provides:
Finally, the Board concluded that Arendt violated Rule 3.3 concerning candor toward the tribunal and Rule 8.4(a), (b), (c), and (d) concerning professional misconduct.
[¶ 15.] We have previously stated that "[t]he foundation of an attorney's relationship with clients and the legal system is trust." Mattson, 2002 SD 112, ¶ 55, 651 N.W.2d at 289 (citation omitted). Arendt's action in deliberately misleading the Board was not only a violation of statute and of the Rules of Professional Conduct, it was also a violation of that trust. After reviewing the record, we agree with the Board that Arendt's conduct was of such serious professional nature that, in the best interests of the public and legal profession, it warrants a suspension from the practice of law.
[¶ 16.] We concur with the Board's recommendation. Therefore, pursuant to SDCL 16-19-35(2), a judgment of suspension will be entered for a period of 120 days, effective August 1, 2004. Furthermore, Arendt must submit an affidavit to this Court stating under oath that:
Arendt is also required to take and pass the Multistate Professional Responsibility Examination prior to any application for reinstatement. Upon expiration of his suspension, Arendt may file his petition for reinstatement pursuant to SDCL 16-19-84 to SDCL 16-19-87. Finally, Arendt shall reimburse the State Bar of South Dakota
[¶ 17.] SABERS, Acting Chief Justice, and KONENKAMP, ZINTER and MEIERHENRY, Justices, participating.
[¶ 18.] GILBERTSON, Chief Justice, deeming himself disqualified, did not participate.
Rule 8.4 provides in relevant part: