Attorneys sued over tax penalties

Sam Skolnik

Thursday, Nov. 23, 2006 | 6:56 a.m.

Two Las Vegas lawyers - who were briefly suspended from serving as temporary judges earlier this decade by the state's Judicial Discipline Commission - have been sued for allegedly negligent behavior that cost their clients more than a million dollars in federal tax penalties.

On Monday an Illinois couple, Tracy and Linda Sunderlage, sued Laura Ungaro and Brian Morrison in District Court. The Sunderlages claim the attorneys failed to file the couple's tax returns or appeals in time and did not attend a required meeting with Internal Revenue Service examiners.

Those lapses, the Sunderlages claim, have cost them almost $2 million in penalties and related fees. The Woodstock, Ill., couple run a number of small international and domestic insurance companies.

The Sunderlages have been engaged in a dispute with the IRS for several years, and they retained Ungaro and Morrison - specialists in the type of tax trust issues they face - in 1999.

The couple had no complaints with Ungaro and Morrison after the attorneys' initial dealings with the IRS.

But on at least two occasions between 2000 and 2002, Morrison failed to attend important meetings with IRS officials, according to the lawsuit. Added to an appeal that the Sunderlages claim wasn't filed on time and an amended return that was never filed, the couple's troubles with the IRS have only grown.

Ungaro, who had been supervising Morrison's work, "took her eye off the ball," Tracy Sunderlage said, adding that Brian Morrison totally disappeared at the time.

Ungaro and Morrison were suspended in 2000 by the discipline commission for not completing required continuing legal education classes - and then for failing to let Las Vegas Justice Court or Las Vegas Municipal Court officials know that they had been placed on "inactive" status by the State Bar of Nevada in January 1998 for seven months.

That meant they were not allowed to practice law during that time, let alone serve as judges.

Both Ungaro and Morrison had served as a referee in Justice Court and as an alternate judge in Municipal Court during that time. Between them, they presided over roughly 20,000 cases - small claims, traffic, domestic violence and other misdemeanors - while their licenses were suspended. After the scandal broke, the city and Clark County offered anyone with a contested case a new trial.

The pair's conduct had "brought disrepute upon both yourself and each of those courts," the discipline commission found. They were suspended from "sitting in a judicial capacity" for six months.

Ungaro did not return calls. Morrison declined to comment, saying he had not yet seen the complaint.

After their suspension, neither lawyer was again appointed to serve as an alternate Municipal Court judge.

The full-time, elected judges on that court, who recommend which lawyers to put on the alternate list, "want to make sure that the person sitting on the bench is qualified, and that they're comfortable with them," Municipal Court spokeswoman Jill Christensen said.

Neither Ungaro nor Morrison has been appointed to serve as part-time referees in Justice Court since at least 2003 , a court official said.

Despite the suspension, Ungaro has continued to work as an alternate judge at North Las Vegas Municipal Court, city spokeswoman Brenda Johnson confirmed. Ungaro presides over weekly probable cause hearings, Johnson said.