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In re Hertach4/22/2005
ORIGINAL PROCEEDING IN DISCIPLINE
Disbarrment.
This is an original action in discipline filed by the office of the Disciplinary Administrator against the respondent, Gerald E. Hertach, of Hutchinson, Kansas, an attorney admitted to the practice of law in Kansas in 1972.
A disciplinary panel of the Kansas Board for Discipline of Attorneys conducted a formal hearing, as required by Kansas Supreme Court Rule 211 (2004 Kan. Ct. R. Annot. 275). The panel unanimously found that Hertach violated Rules 8.4(b) and (c) (2004 Kan. Ct. R. Annot. 485) (misconduct) of the Kansas Rules of Professional Conduct (KRPC) by committing a criminal act that reflected adversely on his honesty, trustworthiness, and fitness as a lawyer and engaging in conduct involving dishonesty, fraud, deceit, and misrepresentation. The panel also found Hertach violated Supreme Court Rule 211 by failing to timely file a written answer to the formal complaint. The panel unanimously recommended that Hertach be disbarred from the practice of law in Kansas. Hertach filed exceptions to the final hearing report, primarily challenging the disciplinary panel's findings regarding the factors which led to the recommended discipline.
The finding that Hertach violated KRPC 8.4(b) and (c) relates to the panel's conclusion that Hertach intentionally concealed his partnership with the Reno County Sheriff when contracting to run a jail annex for Reno County. Hertach's involvement in the Reno County jail operation dates back to 1993 when Reno County entered into an agreement with House Arrest, Inc. (House Arrest), for "alternative incarceration." House Arrest ran a program in a state fair grounds building which housed inmates ordered to serve mandatory 2-or 5-day sentences, typically for convictions of driving under the influence or driving while suspended. Although House Arrest was originally incorporated by Jon Powell, Hertach eventually became resident agent, stockholder, secretary, and a director of House Arrest. When Powell left town, Hertach took over running the company and fulfilled the terms of the contract between House Arrest and Reno County.
Through his experience running House Arrest, Hertach became aware of the county's need for additional jail space and informed the Board of Reno County Commissioners (Board) of his interest in developing a privately run jail annex for the county. Hertach also discussed the county's need for additional jail space with Sheriff Larry Leslie and Undersheriff Kenneth Angell. Hertach, Sheriff Leslie, and Undersheriff Angell formed a "silent" partnership to provide the county with privately run jail space, agreeing to split the profits equally. The three men discussed the need for secrecy and decided to conceal the Sheriff's and Undersheriff's financial interests, recognizing that if those interests were known there would be "political roadblocks." Accordingly, none of the three disclosed their partnership to the Board. The three men also discussed the need to set up separate corporations to protect the profits from the jail annex contract. Hertach suggested that Sheriff Leslie and Undersheriff Angell set up corporations in Nevada. However, at some point, Undersheriff Angell told Hertach he no longer wanted to participate in the partnership because he believed there was a conflict of interest.
In formal and informal meetings with the Board, Sheriff Leslie wholeheartedly supported the idea that Hertach develop and run a private jail annex but did not disclose his financial interest in Hertach's proposal. According to County Commissioner Larry Sharp, Sheriff Leslie's support was integral to the Board's decision to approve Hertach's proposal.
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