May 2005

Disciplinary Notices

These notices of imposition of disciplinary sanctions and actions are published pursuant to Rule 3.5(d) of the Washington State Supreme Court Rules for Enforcement of Lawyer Conduct, and pursuant to the February 18, 1995, policy statement of the WSBA Board of Governors.

For a complete copy of any disciplinary decision, call the Washington State Disciplinary Board at 206-733-5926, leaving the case name, and your name and address.

Note: Nearly 29,000 persons are eligible to practice law in Washington state. Some of them share the same or similar names. Bar News strives to include a clarification whenever an attorney listed in the Disciplinary Notices has the same name as one or more other WSBA members; however, all discipline reports should be read carefully for names, cities, and bar numbers.

Suspended

Theodore P. Hunter (WSBA No. 8453, admitted 1978), of Seattle, was suspended for six months, effective December 22, 2004, by order of the Washington State Supreme Court following a hearing. This discipline was based on his conduct between 1996 and 1999 involving conflicts of interest.

In 1982, Mr. Hunter incorporated PEI, a nonprofit corporation and tax-exempt organization. PEI’s purpose is to promote use of renewable resources and encourage the efficient use of limited resources. During time periods pertinent to the disciplinary proceeding, Mr. Hunter served as a member of the PEI Board, its president, its registered agent, and as a lawyer for the organization, providing his legal services at a reduced rate in exchange for office space. Starting in 1995, Mr. Hunter served in the combined offices of president, treasurer, and “Executive Committee.” The PEI Board, which typically met once a year, consisted of Mr. Hunter’s friends and business acquaintances. For these reasons, a great deal of PEI’s corporate power was concentrated in Mr. Hunter himself.

Matter 1: Between 1996 and 1998, Mr. Hunter leased two or three computers to PEI. The lease payments were invoiced to PEI on Mr. Hunter’s bills for professional services. When the leases terminated, PEI purchased the computers for $1. Mr. Hunter did not provide the leases or his invoices to the PEI Board, did not fully disclose and transmit in writing the terms of the leases to the PEI Board, did not provide PEI with the opportunity to seek the advice of independent counsel in connection with the transactions, and did not obtain the PEI Board’s prior written consent to the leases. Although PEI was not actually harmed by its lease of computers from Mr. Hunter, there was potential injury in that the unreviewed lease terms could have enriched Mr. Hunter at PEI’s expense.

Matter 2: In 1997, Mr. Hunter was looking for a waterfront residence as a second home. In February 1997, Mr. Hunter entered into an agreement for the purchase of a waterfront home on Lake Leland in Jefferson County (Parcel 1). Subsequently, the sellers of Parcel 1 imposed an easement providing pedestrian access to the lake in favor of two nearby parcels (Parcels 2 and 3) owned by other members of the sellers’ family. When Mr. Hunter discovered this, he amended his agreement to purchase Parcel 1 so that it was contingent on the availability of Parcels 2 and 3 “at a reasonable price.” Subsequently, on behalf of PEI, Mr. Hunter signed agreements to purchase Parcels 2 and 3 for $15,000 per parcel. For each agreement PEI issued a $300 check as earnest money. Mr. Hunter thereafter learned that Parcel 2 contained the well that provided water to the house he was purchasing on Parcel 1.

The transactions simultaneously closed in June 1997, with PEI taking title to Parcels 2 and 3. Immediately thereafter Mr. Hunter signed a quitclaim deed for PEI transferring Parcel 2 to himself. Mr. Hunter paid $14,892.06 to close the purchase of Parcel 2, but he did not reimburse PEI for the $300 PEI had paid as earnest money.

Although, prior to the closing of the purchases, a PEI employee had voiced concerns about the PEI purchases, Mr. Hunter did not, prior to closing, consult with the PEI Board about the acquisitions, provide the Board with full disclosure regarding the material facts of the purchases, or obtain the prior written consent of the PEI Board.

Matter 3: In 1998, an individual inquired into Mr. Hunter’s interest in purchasing a 15-acre parcel of property near Parcels 2 and 3. The prospective seller subsequently subdivided the 15-acre parcel into two 7.5-acre lots. Meanwhile, a PEI employee learned that Mr. Hunter intended to add to PEI’s land holding at Lake Leland and requested that Mr. Hunter schedule a board meeting to address the proposed purchase. Mr. Hunter declined to do so. The owner of the two lots offered to sell both for $85,000. Mr. Hunter had PEI purchase one of the lots for $50,000, while Mr. Hunter purchased the other for $35,000. A limited pre-sale appraisal that had been obtained by the seller indicated that both parcels had the same value, and a subsequent tax assessment valued the parcels identically. In purchasing the property and allocating the $50,000 purchase price to PEI, Mr. Hunter did not, prior to the closing of the purchase, fully disclose the material facts to the PEI Board, consult with the PEI Board, or obtain the PEI Board’s prior written consent.

Mr. Hunter’s conduct violated RPC 1.7(b), prohibiting a lawyer from representing a client if the representation may be materially limited by the lawyer’s own interests, unless the lawyer reasonably believes the representation will not be adversely affected and the client consents in writing after a full disclosure; and RPC 1.8(a), prohibiting a lawyer from entering into a business transaction with a client or knowingly acquiring an ownership, possessory, security, or other pecuniary interest adverse to a client unless the transaction and its terms are fair and reasonable and fully disclosed and transmitted in writing to the client, the client is given opportunity to seek the advice of independent counsel, and the client consents.

Linda B. Eide and Nancy Bickford Miller represented the Bar Association. Leland G. Ripley represented Mr. Hunter at the hearing, and Michael R. Caryl represented Mr. Hunter on appeal. Randolph I. Gordon was the hearing officer.

Suspended

Oleg Ordinartsev (WSBA No. 27574, admitted 1997), of Bothell, was suspended for two years, effective November 29, 2004, by order of the Washington State Supreme Court following a stipulation approved by the Disciplinary Board. This discipline was based on his conduct between 2001 and 2003 involving a number of conflicts of interest, the improper disbursement of client funds, improperly attempting to settle a claim for malpractice liability with an unrepresented client, and the inclusion of a false statement in a promissory note.

Prior to 2001, Mr. Ordinartsev represented Client A in a number of matters. In October 2001, Mr. Ordinartsev began representing Client B in connection with a caviar production and distribution business known as the “caviar project,” which involved several corporate entities. Shortly thereafter, Mr. Ordinartsev stopped taking new clients and commenced work as legal counsel for the caviar project, though he retained some of his existing clients, including Client A.

Meanwhile, Mr. Ordinartsev began to discuss the possibility of Client A investing in the caviar project. Mr. Ordinartsev failed to fully advise Client A of all the conflicts inhering in his advice to invest in the business of another client (including the fact that the business employed Mr. Ordinartsev). Mr. Ordinartsev did not obtain written waivers of the conflict from either client.

In March 2002, Client A gave Mr. Ordinartsev $65,000 to invest in the caviar project, expecting to receive stock in one of the caviar project’s corporations. Mr. Ordinartsev deposited the funds into his trust account. Mr. Ordinartsev subsequently disbursed $20,000 to Client B, $20,000 to himself for legal services related to the caviar project, and $25,000 to one of the project’s corporate entities. At the time, Mr. Ordinartsev knew that this use of the funds was inconsistent with the expectations of Client A. Mr. Ordinartsev failed to provide adequate documentation or obtain any security in connection with his use of the funds.

A number of corporate permutations ensued in connection with the caviar project, during which Mr. Ordinartsev acquired an ownership interest in one of the entities. During this period, Mr. Ordinartsev showcased for Client A the project’s production plant in an attempt to assuage Client A’s concerns about the investment. He also unsuccessfully endeavored to obtain from Client B a corporate resolution from the then operational corporate entity acknowledging that Client A had made a $55,000 capital contribution.

Subsequently, pursuant to Client A’s demand, Mr. Ordinartsev prepared a promissory note for the repayment of the money. In the note, Mr. Ordinartsev also agreed to pursue legal action against Client B to recover the money. The note also falsely stated that Mr. Ordinartsev did not personally benefit from his disbursal of Clients A’s funds.

Client A later rejected Mr. Ordinartsev’s promissory note and instead sought Mr. Ordinartsev’s ownership interest in the caviar project. Mr. Ordinartsev agreed to transfer his interest to Client A, and he drafted a settlement agreement to this effect. The agreement included a provision in which Client A abandoned any and all claims against Mr. Ordinartsev. Mr. Ordinartsev failed to advise Client A to consult with independent counsel about the agreement.

Mr. Ordinartsev’s conduct violated RPC 1.1, requiring a lawyer to provide competent representation to a client; RPC 1.2, requiring a lawyer to abide by a client’s decisions concerning the objective of representation; RPC 1.3, requiring a lawyer to act with reasonable diligence in representing a client; RPC 1.7(a) and (b), prohibiting a lawyer from representing a client if the representation of that client will be directly adverse to another client, or if the representation may be materially limited by the lawyer’s responsibilities to another client or the lawyer’s own interests, unless the lawyer reasonably believes the representation will not be adversely affected and the client consents in writing after a full disclosure; RPC 1.8(h), which prohibits a lawyer from settling a claim for malpractice with an unrepresented client without first advising that person in writing that independent representation is appropriate; RPC 8.4(a), prohibiting attempts to violate the RPCs (here, by means of violating RPC 1.9, prohibiting undertaking a representation in conflict with the interests for a former client); and RPC 8.4(c), prohibiting conduct involving dishonesty, fraud, deceit, or misrepresentation.

Jean K. McElroy represented the Bar Association. Mr. Ordinartsev represented himself.

Suspended

Mark A. Panitch (WSBA No. 12393, admitted 1982), of Seattle, was suspended for 135 days, effective December 21, 2004, by order of the Washington State Supreme Court following a stipulation approved by the Disciplinary Board. This discipline was based on his conduct in 2001 and 2002 involving lack of diligence, lack of communication with clients, failure to expedite litigation, failure to return client paperwork and to refund unearned fees at the conclusion of a representation, and failure to deposit client funds into a trust account.

Matter 1: In 2002, a client hired Mr. Panitch to represent him in a pending federal action. The client paid Mr. Panitch $2,500 as an advance fee deposit for hourly work to be performed during the representation. Mr. Panitch deposited the check into his business checking account. In April 2002, the client flew to Seattle from Arizona for a scheduled meeting with Mr. Panitch. Mr. Panitch did not keep the appointment.

In June 2002, the court entered an order granting the client’s motion to vacate an earlier default. Accordingly, the client was obliged to file an answer. In June 2002, the plaintiff notified Mr. Panitch by letter that, owing to the absence of an answer, it intended to move for a default order. Mr. Panitch did not respond to the letter. On July, 9, 2002, the plaintiff moved for a default order. Shortly thereafter, by e-mail, the client’s former lawyer advised Mr. Panitch to file an answer. The client’s lawyer also sent the message to Mr. Panitch via fax, in which he advised Mr. Panitch to contact the client. Mr. Panitch did not respond.

On July 12, 2002, the client hired another lawyer, who filed the answer. Commencing on July 13, 2002, the client and his new lawyer made repeated efforts to contact Mr. Panitch to obtain the client’s file. Mr. Panitch did not respond to these overtures. In late August 2002, the client’s new lawyer warned Mr. Panitch that if the file was not delivered, he would file a grievance with the Bar Association. On August 28, 2002, Mr. Panitch replied that the file was available for retrieval. The new lawyer picked up the file on September 9, 2002. Although Mr. Panitch had performed only $1,000 worth of services, he never refunded any part of the $2,500 advance fee.

Matter 2: In March 2001, Mr. Panitch entered an appearance on behalf of a client in a pending personal-injury lawsuit. After filing a notice of appearance in March 2001 and a confirmation of joinder in April 2001, Mr. Panitch filed no other documents in the case. The client informed her former lawyer that Mr. Panitch was not involved in the case, and asked him to fire Mr. Panitch. In November 2001, the former lawyer met with Mr. Panitch, informed him that the client was dissatisfied, and notified him that the client wanted Mr. Panitch to return the file. Mr. Panitch told the former lawyer that he would discuss the situation with the client and address her concerns. He did not, however, communicate with her promptly.

In January 2002, opposing counsel noted the client’s deposition for January 22, the date of the discovery cutoff. By letter, Mr. Panitch notified opposing counsel that he voluntarily waived the discovery cutoff, thereby allowing opposing counsel to reset the deposition for January 24. Mr. Panitch did not communicate with the client about this course of action; he waived the discovery cutoff because of a personal scheduling conflict. On January 22, 2002, Mr. Panitch telephoned the client and asked her to appear for the January 24 deposition. During the conversation, the client informed Mr. Panitch that he was fired. Although the client had not authorized Mr. Panitch to communicate further with opposing counsel, Mr. Panitch assured opposing counsel by letter that there was an agreement waiving the discovery cutoff, and that if the client’s new lawyer attempted to resist a deposition and assert the discovery cutoff, Mr. Panitch would support the opposing lawyer’s right to take the deposition.

Mr. Panitch’s conduct violated RPC 1.3, requiring a lawyer to act with reasonable diligence in representing a client; RPC 1.4, requiring a lawyer to keep the client reasonably informed about the status of a matter and to explain a matter to the extent reasonably necessary to permit the client to make informed decisions; RPC 1.5(a), requiring that a lawyer’s fee be reasonable; RPC 1.14(a), requiring all funds of clients paid to a lawyer to be deposited in an interest-bearing trust account; RPC 1.15(d), requiring that a lawyer take reasonably practicable steps to protect a client’s interests upon termination of representation (including refunding any advance payment of fee that has not been earned and surrendering papers and property to which the client is entitled); and RPC 3.2, requiring a lawyer to make reasonable efforts to expedite litigation consistent with the interest of the client.

Anthony L. Butler represented the Bar Association. Leland G. Ripley represented Mr. Panitch. Robert C. Bibb was the hearing officer.

Suspended

John D. Schumacher (WSBA No. 5348, admitted 1973), of Montesano, was suspended for 60 days, effective December 6, 2004, by order of the Washington State Supreme Court following a stipulation approved by the Disciplinary Board. This discipline was based on his conduct in 2001 and 2002 involving acquisition of a security interest adverse to a client without full disclosure, withdrawal from a matter without adequate notice, and service of a motion for default on parties who had not been served with the summons and complaint. (Mr. Schumacher is to be distinguished from John W. Schumacher of Shelton.)

Matter 1: While representing a client in a dissolution matter in 2001, in order to secure his fee, Mr. Schumacher obtained from the client and recorded a $20,000 mortgage on the family residence. Other than the loan instruments themselves, Mr. Schumacher did not provide any written disclosure to the client about the transaction. Shortly before a hearing in the dissolution matter, following a meeting at the courthouse, Mr. Schumacher advised the client that he would stop representing her; he then left the courthouse before the hearing began. Mr. Schumacher provided no further legal services to the client. The client later signed a quitclaim deed to Mr. Schumacher for the residence subject to the $20,000 mortgage, shortly before a lender foreclosure was scheduled to occur.

Matter 2: Mr. Schumacher represented plaintiffs in a matter involving approximately 98 defendants. He filed a motion and declaration for default directed to a number of the defendants. The declaration averred that the defendants had been served with copies of the summons and complaint but had not filed or served answers within the time provided by law. It further averred that the defendants were not in the armed forces of the United States of America. When Mr. Schumacher signed the declaration, 11 of the defendants had not been served with the summons and complaint, and one of the defendants was on active duty in the armed forces. Although Mr. Schumacher’s assistant ordinarily kept track of matters relating to service and had prepared the declaration, Mr. Schumacher noticed that mistakes had been made, but he signed the declaration anyway.

Mr. Schumacher’s conduct violated RPC 1.8(a), prohibiting a lawyer from entering into a business transaction with a client or knowingly acquiring an ownership, possessory, security, or other pecuniary interest adverse to a client unless the transaction and its terms are fair and reasonable and fully disclosed and transmitted in writing to the client, the client is given opportunity to seek the advice of independent counsel, and the client consents; RPC 1.15(b), permitting a lawyer to withdraw from representing a client only in defined circumstances or if the withdrawal can be accomplished without material adverse effect on the interests of the client; RPC 1.15(d), requiring, upon termination of representation, that a lawyer take steps to the extent reasonably practicable to protect a client’s interests; RPC 3.4(c), prohibiting a lawyer from knowingly disobeying an obligation under the rules of a tribunal except for an open refusal based on an assertion that no valid obligation exists; and RPC 8.4(d), prohibiting a lawyer from engaging in conduct prejudicial to the administration of justice.

Linda B. Eide and Nancy Bickford Miller represented the Bar Association. Kurt M. Bulmer and Curtis M. Janhunen represented Mr. Schumacher. David K. Hiscock was the hearing officer.

Reprimanded

W. Russell Van Camp (WSBA No. 5385, admitted 1973), of Spokane, was ordered to receive a reprimand, effective September 9, 2004, following a hearing. This discipline was based on his conduct in 1996 involving failure to sufficiently explain the terms of a fee agreement to a client and removal of funds from his trust account as fees before they were earned.

In June 1996, a client hired Mr. Van Camp to handle a medical malpractice case against a Spokane physician. The client signed a contingent fee agreement and paid Mr. Van Camp $1,000. This sum, characterized in the fee agreement as an “earned retainer fee,” was an advance payment for attorney fees and costs to be incurred in conducting an initial investigation into the viability of the claim. Mr. Van Camp did not adequately explain the nature of the “earned retainer fee” to the client, who did not fully understand the purpose of the payment.

Promptly after the $1,000 was deposited into Mr. Van Camp’s trust account, Mr. Van Camp disbursed $35 to pay for medical records and $900 to himself as a fee. At that point, the fee had not yet been earned. Over the course of the next several months, the client advanced additional sums to pay for the costs of obtaining medical records and review of the case by a medical expert. The expert, a local medical practitioner, opined that he could find no evidence of medical malpractice. For this reason, Mr. Van Camp advised the client not to invest further in the case without seeking the opinion of an out-of-state medical expert.

In March 1997, at the client’s behest, Mr. Van Camp filed a complaint against the Spokane physician; because the statute of limitations would shortly run, this was a precautionary filing to permit the client to decide whether to proceed. Ultimately, the client elected not to proceed and asked Mr. Van Camp to drop the lawsuit. Mr. Van Camp refunded the balance remaining in his trust account and instructed an associate to obtain a dismissal. In August 1997, an agreed order of dismissal was entered.

Mr. Van Camp’s conduct violated RPC 1.4(b), requiring a lawyer to explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation; and RPC 1.14(a), requiring all funds of clients paid to a lawyer to be deposited in an interest-bearing trust account.

Jean K. McElroy represented the Bar Association. F. Lawrence Taylor Jr. represented Mr. Van Camp. Diehl R. Rettig was the hearing officer.

Nondisciplinary Notices

Suspended Pending Outcome of Disciplinary Proceedings

Donna J. Light (WSBA No. 22465, admitted 1993), of Renton, was suspended pending the outcome of disciplinary proceedings, pursuant to ELC 7.2, effective March 17, 2005, by an order of the Washington State Supreme Court. This is not a disciplinary action.

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