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Kraklio v. Simmons

Supreme Court of Iowa

March 16, 2018

RAY J. KRAKLIO, Appellant,

         On review from the Iowa Court of Appeals.

         Appeal from the Iowa District Court for Scott County, J. Hobart Darbyshire, Judge.

         Criminal defense attorney seeks further review of court of appeals decision that reversed district court's summary judgment dismissing legal malpractice action.

          Curtis R. Dial of Law Office of Curtis Dial, Keokuk, for appellant.

          Alfredo Parrish of Parrish Kruidenier Dunn Boles Gribble Gentry Brown & Bergmann L.L.P., Des Moines, and Kent A. Simmons, Bettendorf, pro se, for appellee.


         This appeal presents the narrow question of whether the relief-required rule (also called the exoneration rule) applies to a convicted criminal suing one of his defense attorneys for legal malpractice over an alleged missed opportunity to shorten his period of supervised probation. This rule ordinarily requires proof the client had been exonerated from the underlying conviction. The defendant attorney was retained after the malpractice plaintiff was convicted and sentenced on three counts of welfare fraud and ordered to pay restitution. The attorney successfully obtained postconviction relief vacating two convictions and over $80, 000 in restitution and successfully opposed the state's effort to have his client civilly committed as a sexually violent predator. Meanwhile, the offender, represented by separate counsel, was incarcerated for a probation violation. The district court later determined sua sponte that his term of supervised probation should have ended earlier, which would have avoided nearly a year in prison. The offender then sued one of his lawyers for malpractice.

         The defendant attorney moved for summary judgment on four grounds. The district court reached only one ground and granted summary judgment based on the relief-required rule. The court of appeals reversed the summary judgment and held the client may sue over the alleged sentencing error without proving his exoneration from the conviction, so long as he obtained relief from the sentencing error. That is the position taken by the Restatement (Third) of the Law Governing Lawyers. We hold the malpractice plaintiff in this situation must prove relief from the sentencing error allegedly caused by the malpractice, not the underlying conviction. We express no opinion on the alternative grounds for summary judgment, including the scope of this defendant-attorney's duty, if any, to monitor the duration of supervised probation. Those issues were not briefed or argued on appeal and may be decided by the district court on remand.

         I. Background Facts and Proceedings.

         In November 2002, after a lengthy investigation into suspected welfare fraud, Ray J. Kraklio was charged with three counts of first-degree fraudulent practice in violation of Iowa Code sections 714.8(3) and 714.9 (2001). The facts are set forth in the decision of the court of appeals on his direct appeal, as follows:

Beginning in the early 1980s the Iowa Department of Human Services (DHS) suspected that Kraklio was living with Debra Dirksen and that at least one of her two children, Tammy, who was born February 21, 1980, and Chad, who was born October 2, 1981, was Kraklio's child but that Dirksen and Kraklio were concealing this fact and his income contribution to the household in order to obtain welfare assistance, including food stamps, Family Investment Program (FIP) benefits (formerly Aid to Dependent Children (ADC) benefits), and Title XIX medical benefits. Between then and November of 2001 Child Support Recovery Unit (CSRU) personnel repeatedly questioned Dirksen as to whom the father of her children was or might be. Dirksen repeatedly maintained she had no idea who the father might be, and that Kraklio was not the father. Kraklio attended most of Dirksen's interviews by state personnel, was aware of what Dirksen told them, and himself denied he was the father of any of Dirksen's children. DHS records also indicate that during this same period of time Dirksen listed Kraklio as her landlord and daycare provider and the DHS used the rental and child-care figures provided by Dirksen to determine and increase her ongoing monthly public aid benefit amounts. Iowa Department of Inspections and Appeals (DIA) Investigator Randy Dodson was also aware of and worked on this case from time to time beginning in the early 1980s.
In November 2001 Kraklio telephoned Investigator Dodson with a child support and welfare fraud complaint regarding his ex-wife. Dodson made arrangements to meet with Kraklio. Dirksen showed up with Kraklio for Dodson's November 28, 2001 interview. At the interview Kraklio and Dirksen revealed to Dodson that they had been together for twenty-one years. They stated they had only been married for about one year, but had only been apart for approximately three months of the last twenty-one years. Dirksen and Kraklio also admitted to Dodson they had one child together, Chad Dirksen, born October 2, 1981. Based on this information Agent Dodson determined he should proceed to a criminal fraud investigation.
The fraud investigation continued for approximately a year until a trial information was filed on November 26, 2002.

State v. Kraklio, No. 03-0813, 2005 WL 156803, at *1 (Iowa Ct. App. Jan. 26, 2005).

         Kraklio's first attorney negotiated a plea bargain in which Kraklio agreed to plead guilty to all three counts and pay restitution while the state agreed to recommend probation. The court accepted Kraklio's guilty plea and, on April 17, 2003, sentenced Kraklio to concurrent terms of not more than ten years, suspended the sentences, and placed him on five years of probation on each count to run consecutively. The court also ordered restitution totaling $139, 489.

         Kraklio met with his probation officer who, according to Kraklio, told him that if he appealed he would not be supervised during the appeal. Kraklio filed a pro se notice of appeal on May 16, 2003. On June 19, the district court appointed attorney Kent Simmons to represent Kraklio on this direct appeal. This is when Simmons's representation of Kraklio began.

         Simmons promptly informed Kraklio that the probation officer was not required to suspend supervision because Kraklio had not posted an appeal bond. Kraklio declined to post an appeal bond. Simmons also advised Kraklio that he had the right to begin his supervised probation while the appeal was pending, but Kraklio chose not to do so.

         Simmons moved for and obtained a limited remand to conduct discovery into statute of limitations defenses. Based on the fruits of his discovery, Simmons argued Kraklio's trial counsel was ineffective in failing to argue that some or all charges were time-barred. In its decision on the direct appeal, the court of appeals concluded that Kraklio's trial counsel breached an essential duty by not determining "the possible viability of a statute of limitations defense." Id. at *6. The court of appeals found the record inadequate to determine prejudice on two counts; the court preserved those claims for postconviction proceedings. Id. at *8. On the third count the court determined Kraklio was not prejudiced by any breach of duty and rejected Kraklio's ineffective-assistance-of-counsel claim. Id. The court of appeals affirmed Kraklio's convictions on all counts, and procedendo issued on April 25, 2005.

         Kraklio's supervised probation began in August. The probation officer asked Kraklio to sign a restitution plan to comply with the sentencing order, but Kraklio repeatedly refused to do so. In December, the probation officer filed a report of the probation violation, stating that he "resumed supervision of his case in August 2005" after Kraklio's appeal was denied. Simmons represented Kraklio on this probation violation. In February 2006, Kraklio signed a restitution plan in which he agreed to pay $12, 000 annually until he paid $139, 488 restitution in full.

         Kraklio hired Simmons to represent him in a postconviction-relief (PCR) action, which Simmons filed in May. Pursuant to a fee agreement, Kraklio paid Simmons nearly $10, 000 for preparing, filing, and litigating the PCR action.

         In January 2008, Kraklio's probation officer filed another report of probation violation because Kraklio had failed to comply with the restitution plan. Kraklio applied for counsel, and the court appointed a different lawyer to represent him. After a hearing, the court revoked Kraklio's probation on January 31, 2008, and ordered him to prison.

          On April 3, the PCR court granted a motion for summary judgment filed by Simmons and ordered Kraklio's convictions on two counts vacated as barred by the statute of limitations. This avoided over $80, 000 in restitution.

         Meanwhile, the Iowa Department of Corrections delayed Kraklio's release from prison pending a determination whether he was a sexually violent predator based on his 1978 conviction for lascivious acts with a child. Simmons successfully litigated a motion for reconsideration of sentence. On March 24, 2009, the court entered an order vacating the sentence of imprisonment. The court ordered Kraklio to immediately contact his probation officer, stating that "supervision shall continue as originally ordered herein."

         Kraklio resumed supervised probation without contesting his probation status. He again failed to pay restitution, so the probation officer filed another report of violation of probation. A different attorney was appointed to represent Kraklio at the revocation hearing held on February 4, 2010. By this time, Kraklio's original probation officer had retired, and the new probation officer testified that Kraklio's original probation began in April 2003, not August of 2005:

Q. Do your records indicate when the probation started for Mr. Kraklio?
A. The original probation?
Q. Right.
A. I believe it was March of 2003.
Q. Okay?
A. Excuse me, April of 2003.
Q. And was that probation ordered for any particular length of time?
A. I believe it was ordered . . . for five years for each count.
Q. And was that to be consecutive or concurrent?
A. I believe it was consecutive.
Q. When you make reference to the fact consecutive sentences for each count, that also would be affected by the dismissal of two of those ...

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