*1 171 February 24, suspended 1971, Argued 6, December May rehearing 24, petition 1972 denied for Complaint to the Conduct In re Accused. BROWN,
NEIL P2d 1376 493 P2d 668 Wheatley, G. William Eugene, argued cause briefs was E. On the John Eugene. for Jaqua, accused. Gillis, D. Harold Eugene, argued the cause Oregon State Bar. himWith on the brief was Jon A. Joseph, Eugene.
Before O’Connell, Chief Justice, and Denecke, and Bryson, Justices. Holman, Tongue, *2 PER CURIAM. disciplinary proceeding by
This is a Oregon charging State Bar the accused with unethical con- charges complaint duct. Most of the arise out of the accused’s serving acts, failure to act, while attorney County, as Oregon, administrator in Lane of the estates of Robert and Marion Beach and their two sons.
Mr. and Mrs. Beach their two sons died in- airplane January testate as a result of an accident on 20-year-old daughter, and left 28,1957, a Garnet Claire Ratley (hereinafter Garnet), Beach referred to as as heir. their sole parents engaged deceased in four saw- operations Oregon
mill and timber in at the time of Oregon Two of their deaths. the businesses were cor- they porations, corporate of which owned all of partnerships. and two were conducted They shares, as operated logging, also had an interest in a timber, Siskiyou County, in and sawmill business California. a The accused had been friend of the deceased appointed parents. He was administrator of each 9, January upon four 1958, surviving petition the sole Garnet, heir, who was living in married and Mt. Shasta, then California. As president he acted as administrator, the two managed corporations partnership businesses. parents per The deceased also owned a 50 cent Oakridge including interest in the Funeral Home, property, partnership Dewey real with Mr. and Mrs. Mattie. In sold accused, 1965, administrator, per surviving partners estates’ cent interest to the promissory cash and a secured note in $10,872.74 the amount $8,564.24. Eatley,
Dr. and husband of dentist, G-arnet, was appointed parents’ administrator the deceased ancillary probate Siskiyou proceedings County, the accused made nu- However, California. participated trips in an at- to California and merous oper- tempt the affairs of the to unravel California ation. four
At time of the deaths members family, parties, most of the interested of the Beach including accused, that the assets of believed *3 parents were of substantial value. The value deceased operation holdings and timber was the of California to million dollars.” Within a few to be close “a believed machinery the learned that much of the accused
months operations Oregon had of the been trans- and assets undertaking, and that the the ferred to California (corporations partnerships) Oregon and businesses managed profitable. to terminate an un- He not were with the Bohemia Lumber Com- contract favorable Oregon logging liquidated of the assets pany the and the two deceased of sons were The estates ventures. parents’ in each of the Inventories value. of nominal 9, December 1960. filed until not were estates Eatley petitioned Dr. the 1959, Su- November, In ancillary to terminate the in California perior Court the that the assets proceedings on basis in probate early as As October 25, worthless. were California City major of Twin Lumber a creditor the 1960, Co., County, operation, petition California filed a in Lane Oregon, to the accused removed as administrator have of the estate of Bobert Beach. The court denied the G. argument petition hearing “provided after of counsel Neil file with this Administrator, Brown, day Inventory an December, Court the 9th 1960, Appraisement estate and in above-entitled proceed diligence the further administration with filing inventory, of the Prior to said estate.” petitioned had and secured administrator, accused, confirming of the the sale of certain assets an order final estates. The accounts each two Beach July parents’ not until 18, filed years after accused had and one-half 1969, eleven By granted the time the of administration. letters been estates, 1961 account filed his accused had City paid Lumber to Twin Co. been $18,000 had Oregon proceedings. probate A in the filed their claim paid this California creditor, was $51,000 total paid the accused from his of which $12,000 from assets the balance personal funds other creditors filed claims Oregon Numerous estates. they paid were not but of limitations.” the statute “because Batley, separated husband, Dr. from her Garnet University Eugene attend the Ore- moved July deposition taken on 2, of Garnet gon In in 1962. proceedings exhibit as an received 1968, and testified she tried committee, she trial before early the estates as as the to close get why they never find out could she spring of 1962 *4 regarding questioned was accused The not closed. “Well, stated, there isn’t he problems and financial his over-extended.” The ac- I was that. any about doubt eused further testified that knew he was in Garnet money need of and that she offered to borrow some money against certain securities that she owned and make it to him. He took her to the main available branch of the Bank and intro- United States National told duced to a Arthur and Mr. Pullen Pullen, her Mr. give purpose of loan for to was Garnet money. him a total of $25,000 some borrowed Garnet by to December, 1963, which she delivered him and he deposited personal account. He also same in making loan he testified that before this advised her gave her with other counsel and the names consult lawyers. of three he did not know if she con- However, any pledged her sulted of them. She securities with Her loan to the $25,000. with the bank to borrow by any not was unsecured and was evidenced accused writing. agree pay the on He did interest her notes payments two of the at least interest to the bank but from assets of estate in the amount were made pur- had made The accused commitments $1,865.56. Coburg, Oregon, pieces one north land, chase two “Spencer $25,000 Butte.” The the other south pieces payment property. these two for was used by notes executed term Garnet were short re- The Duplicate time to time. the bank notices newed the notes were sent to due on Garnet of interest years paid not for five notes were accused. indirectly bringing resulted Garnet action this the amount of to recover the loan. accused part in the latter of 1968. The was settled This action respective counsel sides. was effected settlement pay required the accused to $13,111.22 settlement Bank National on ac- States the United notes, $6,888.78 to Garnet. The the Garnet count given credit for sum $12,000, he *5 personally claimed to have advanced on behalf of the to settle claims estate creditors in California. “Assignment In this accused connection, the took an of right, Interest in Estate” from her Garnet of “all of remaining title and in interest” of the estates Marion J. Beach and Robert deceased. The above Beach, G. facts testimony are either admitted the of the accused confirms the same. charged
The Bar the accused with eleven causes complaint, setting of forth acts of various misconduct practice. complaints and unethical Nine of the arise mishandling out of failure to the accused’s of and wind up the affairs of four The Board of the estates. Gov- voting, guilty charged the ernors, nine found accused complaint. of The of the causes accused seven appeals, arguing the most that can be said guilty procedural him of violations in that he is is of the estates. administration agree this with conclusion. cannot The ac- We testimony committee, the trial admits before cused, attorney. unexplained misconduct as an This to his judged light acting of his particularly so when fiduciary of four estates. and administrator aas began arbitrarily, when he troubles accused’s attempted approval court, the circuit without operations logging sawmill and continue per- Beach, to deal and Marion and Robert deceased sonally corporate partnership and ventures. with charged by act, acts, or failure to Several intermingled support and are used are Bar charges that the complaint. Bar causes County obey of the Lane directions willfully failed Court, to show said failed further court Circuit cooperation respect, candor, and judges the its Bar. State member of a required On five December 23, 1968, occasions between July County the Lane 15, 1969, Circuit Court appear at time letter, directed accused, concerning parents’ certain the status of two filing and the In final accounts each estate. response to the first notice the accused 23, on December appeared and advised the court that both estates ready only closing prepara- there remained tion Thereafter, final account. he failed *6 comply requests with the court’s written on each occa- estates, sion. The this time, at were eleven and one- years probate. half in respect part on the of
This action and lack of statutory contrary to the is the duties of an 9.460(2) 9.460(4), attorney provided in and OES (3), provides the and conflict with 9.480 which OES grounds suspension, reprimand. or disbarment, period This a six-months resume of short of comply requests with the court’s accused’s failure disregard pertain only part his total of law is of ing probate diligence and the of estates due attorney acting part an either as attor of an while ney In Smith, of an estate. re administrator or as an (1943), pages states, at P2d 956 159-60 171 Or 151, 134 lawyer obligation courts, to his client, of “The a ordinary public one, but demands honor is no and the discharge pro punctilious of all his the most * * comply failure to The total duties fessional probate respect professional to the duties with his complete apparent from of a review of these probate including two files evidence, all of Beach which were and Eobert of Marion the estates the trial committee. This before in evidence received of Eule 27 of the Eules a violation constitutes action Bar in State Conduct of Professional during period probate. force 116.170, in ORS prior July provided: effect 1, 1970, person [other engaged
“In all eases where a dies while any partnership] trade business, or than a * * * having jurisdiction the court of the admin- may, istration of the estate such decedent in its * * * discretion, authorize the administrator of carry the estate to continue and on such trade period business for not exceed 12 months after require death the decedent. The court shall * * * such administrator to file such additional undertaking, upon faithfully carry- conditioned * * ing out his trust and all orders the court, provided: ORS 116.175 * * *
“In the conduct of a
or business,
trade
keep
administrator shall
and
full
accurate account
receipts
expenditures,
of all
and also of all
payable
accounts
and shall make
receivable,
* *
monthly reports to the court
petition
In the instant
the accused failed
case,
authority,
post
the court for such
failed to
additional
undertaking,
operations
continued the
in excess of
keep
twelve
failed to
full and accurate account
months,
completely
receipts
expenditures,
failed to
*7
monthly reports thereof to
court. In
the
all,
make
the
attorney
and administrator
accused’s actions
fiduciary
serious breach of his
these estates are a
re
implied
by
upon
lationship
him
and the duties
law.
charges the
Bar further
accused with un
The
borrowing
from
$25,000
the sole
ethical conduct
August
Garnet, between
and De
estates,
heir of the
previously
have
reviewed most of
We
cember, 1963.
regard
charge.
pertinent
to
this
This
evidence
charge
discussed in the recent
to one
de
similar
George
Staples,
in In re
court
C.
this
cision
(1971).
Or
accused did
406, 410,
The Board of recommended that Neil Governors Supreme suspended Brown be Court from the b}r Oregon practice period in the for a of law State years. agree appropriate that this is the most two We discipline. practice suspended
The accused is years period two and thereafter until he law for a application for reinstatement and until he has made affirmatively respects again that he is in all show shall position qualified as a member to resume his able resumption that his this state and of the Bar of practice will not detrimental the Bar of law be public interest. to the judgment Bar also awarded State and disbursements for its costs disciplinary proceeding in accordance
incurred 9.540(2), (3). with ORS REHEARING FOR
ON PETITION *9 PER CURIAM. opinion,
In our 262 Or 171, P2d 1376 (1972), agreed we with the Board of Governors suspended State Bar and the ac- practice period cused from the of law for a of two years. petitions The rehearing, this court for contending by imposing that we “erred in this decision extremely discipline,” an severe form of and that it was “not warranted the facts.” Three of the as- signments expression by warrant further this court. opinion The stated: “* ** deposition In of Garnet taken on July pro 1968, and received as an 2, exhibit in the ceedings the trial before committee, she testified get that she tried to the accused to close the estates early spring as as the of 1962 and she could never # * why they find out were not closed *.” petition stating depo- The correct in rejected by as an was sition, exhibit, the trial com- get mittee. The statement “that she tried to the ac- cused to close the estates” could well have been omitted opinion. at The does
from the record disclose hearing, 12, 1970, time of the March Beach were not and Marion closed. Robert G. Beach J. were issued to the accused Letters administration January 1958. 9, Bryson, that Richard also discloses at- record torney called a witness testified at : law, [Garnet] me to came to consult about
“She parents and estates estates. There some her brothers. Beach expressed were four of them. She way they with the had dissatisfaction been length of time it had taken, and the handled asked me to into them and advise her.” look *10 (By Joseph) [sic] Did Mr. Mrs. Beach “Q. any you express [Garnet] over concern estates? expressed over “A. concern she—she Yes, length particularly with reference to the estates, of they taken. time had express any money concern about Did she “Q. being missing? expressed concern at the lack of “A. ac- She
countings. you that she had she indicate at- “Q. Did tempted an Yes, “A. accounting get she said that from Mr. information Brown she had been unable to [*] * Mr. Brown? get portion objection this taken to of the testi- No testimony relates time mony. to a this much While “spring of it does indicate 1962,” that than later get to close the estates. tried to Garnet opinion stated that “the evidence also re- Our Garnet, did suffer a loss client, because veals accused.” Petitioner contends conduct finding this is incorrect and “inconsistent with all of the evidence in the case.” We also stated:
“* * * The accused admits that some $20,000 by belonging of funds received him to the estate did go through banking not were the estate but accounts, deposited by to his account or used him in defraying expenses that he advanced on behalf of accountings by and dis- the estate. The exhibits and the accused are in such an filed unorganized arranged by pre- condition that we cannot find ponderance of the evidence whether the funds were by or were not used or diverted the accused. There per- evidence to indicate that the accused did not * * sonally gain from these transactions again meager accountings We have reviewed the acting filed attorney with the court accused, together administrator of the four estates, with the exhibits received the trial committee and the transcript testimony at the time of the trial. We are again impressed why with the reason this accused finds embarrassing position. himself in such an attempted He logging operations continue the and sawmill deceased per- Robert and Marion Beach and to deal sonally partnership corporate with the ventures rather than as administrator of the assets of these es- approval all tates, without of the court.
In an effort to unravel the accused’s trans- public action as administrator, certified accountant employed firm of Lee, Coleman, Allen & Bedint was *11 analysis secure an of the financial transactions in- volving the estates of Robert Gr.Beach and Marion J. stipulated “analysis” Beach. It was that be re- joint summary ceived in evidence as a exhibit. A from accounting firm that attached to the exhibit reads in part as follows: you propérty
“As there was certain know, listed corporate in two estates which took the form partnership fur- or interests. were not We stock, any com- financial information on these nished panies, we are not able state how therefore, Obviously, disposed of. some these interests analysis rep- in onr of the transactions contained properties of certain which wore resent owned sales by corporations partnerships. these say repre- whether this However, we are unable organizations, property or all of the of these sents only part a thereof.” record we are met with the
From review of the onr expressed by problem the firm of accountants. same adequate keep A com- The records. accused did not inventory appraisement parison in filed property disposed personal with estates records they as far as disclose the records, shows complete. are not transactions, assets and estate testimony approval accused, that the without discloses salvage attempted the assets a bus- court, operated previously the deceaseds in iness northern he used funds and that from California language, his own This, in this effort. is gave apparently met downfall. he Mr. Brown where testimony hearing following at the before the trial committee: you was the manner in which Now, handled
“Q. or abnormal or unusual different from this estate which, yon approached legal manner other including other ? matters, I took an after time intense Well, “A. interest salvage trying something or do to solve aborit California, loss I’m sure horrible that —that fifty three hundred exceeded it have must dollars, didn’t but it .work.” thousand testimony describing replete with record salvage oper- assets the California attempt *12 prin- that the two ation. The record also discloses period cipal kept open twelve were for a years years the administrator and for a number of approximately bond renewed at an annual cost of was Subsequently, petition, amount of the $550. began bond until such time that he was reduced dispose property see of real the estates. We can no keeping open period for a reason for these estates years. Undoubtedly the lost assets twelve probate. time for The record also the extension of the charges penalty discloses interest and on estate taxes. charges against One of the other borrowing was in with his $25,000 connection heir of the estates. had Garnet, She, turn, sole money personal borrowed this from the bank on her paid. pay The accused was which were not notes, acknowledged the interest. he However, two totaling payments, $1,865.56, the interest made from assets the estate. reviewing we evidence,
From all of must the sole heir of Garnet, estates, conclude that did of the conduct of the accused suffer loss because attorney of the four estates. administrator stating assignment criticizes our that the Petitioner wrong- was interest to the accused of the client-heir’s ful. assignment was settlement heir’s petitioner’s against petitioner claims
claims The settlement document states that the client. $20,000. The settlement is settled heir’s claim by paying petitioner’s part accomplished in obli- was gation funds. This, heir with estate without obviously wrongful. pe- explanation, is further explanation but had no this occurred denies titioner could at- Petitioner’s except attorney explain. was called he did how it torney but not explain note use on a proper moneys representing payments which asset ob- was an estate to pay petitioner’s This was ap- heir. mode of settlement ligation *13 how- attorney; the heir’s then agreed parently make any explanation. he was not called to ever, adhere of the evidence in the we record, On the basis “wrong- assignment our characterization in mind that this conduct,” arrangement ful having sole heir’s interest in the es- the assignments court. approved by tates were not probate rehearing is denied. The petition