May 2000

Disciplinary Notices

Barbara Beatty (WSBA No. 17968, admitted 1988), of Seattle, has been disbarred by order of the Supreme Court effective March 23, 2000, following a hearing. The discipline is based on her Alford plea to two counts of securities fraud involving two clients.

In 1992, Ms. Beatty began soliciting investment contracts to finance construction of six houses in Algona, Washington. She raised $229,000 from four investors. She did not invest any of her own funds in this project. Ms. Beatty misrepresented several material facts to the investors, including: 1) they would earn 30 to 50 percent return on their investments, with no reasonable basis in fact; 2) their investments would be fully secured, when Ms. Beatty's equity in the property did not fully secure any of the investments; and 3) she would have a buyer for each house prior to it being built, although she built only two houses and did not have a buyer until after the houses were completed. After the project failed, Ms. Beatty failed to fully repay the investors.

Two of the investors were Ms. Beatty's clients. One, a 69 year-old woman, told Ms. Beatty that she was in failing health and that she worried about having enough money to live on prior to making the investment. Ms. Beatty told the client this was a safe investment. Relying on Ms. Beatty's statements, the client invested $25,000. More than a year elapsed between the time the project failed and when Ms. Beatty communicated this to her client. She gave the client a promissory note calling for $500 monthly payments.

The other client invested $42,000 in Ms. Beatty's project. Shortly after making this investment, the client's job situation changed, and she requested to withdraw her investment. Ms. Beatty returned $10,397.71, but convinced the client to leave the remainder. After several unanswered phone calls, the client retained counsel and filed a complaint against Ms. Beatty. Ms. Beatty sent the client $10,000, but never disclosed that she was no longer managing the project.

Ms. Beatty pled guilty to two counts of securities fraud. Between the time of the plea and sentencing, Ms. Beatty repaid both clients' principal with interest. As a result, one count was dropped and Ms. Beatty was sentenced on the other. She received 60 days' home detention, 30 days' community service and 12 months' probation.

Ms. Beatty's conduct violated RLD 1.1(a), (i) and (p), stating that a lawyer may be subject to discipline for conduct evidencing a disregard for the rule of law; conduct reflecting adversely on the lawyer's honesty, trustworthiness or fitness as a lawyer; and conduct demonstrating unfitness to practice law.

Linda Eide represented the Bar Association. Thomas Coe represented Ms. Beatty. The hearing officer was Lish Whitson.

Charles W. Burns (WSBA No. 12957, admitted 1982), of Montana, has been disbarred by order of the Supreme Court effective March 23, 2000, following a default hearing. The discipline is based upon abandoning his practice without notice to his clients, failing to properly deal with client funds, failure to diligently represent clients, and negotiating settlement checks with forged endorsements and converting client funds to his own use.

In December 1997, Mr. Burns transferred to inactive status with the Bar Association. Shortly after this date, he left Washington, abandoning his practice. He failed to notify his clients of his absence, make arrangements for another lawyer to take over his client matters, or return files and documents to his clients. The Bar Association appointed a file custodian, who found unopened mail, unfiled documents, and client files with little or no work or client contact. Mr. Burns' conduct violated RPC 1.15(d), requiring a lawyer to take steps to protect clients' interests when withdrawing from representation.

The Bar Association audited Mr. Burns' trust account after he transferred to inactive status. The auditor found that Mr. Burns did not keep sufficient records to accurately track client money paid to his office. Additionally, in several client matters, Mr. Burns failed to deposit client funds into his IOLTA trust account; failed to deposit client funds into a separate IOLTA account with interest paid to the client, when this would provide a net positive return for the client; failed to promptly pay or deliver client funds to client upon request; and failed to return unearned advance fee or cost deposits.

Mr. Burns' conduct violated RPC 1.14, requiring lawyers to deposit all client funds paid to the lawyer into an interest-bearing IOLTA account; maintain complete records of all client funds, securities and other properties coming into the lawyer's possession; and promptly pay or deliver client funds to the client upon request.

In three client matters, Mr. Burns failed to act with reasonable diligence and promptness in representing clients. In these same matters, he failed to keep the clients reasonably informed about the status of their legal matters. Mr. Burns' conduct violated RPC 1.3, requiring lawyers to act with reasonable diligence and promptness in representing clients; and RPC 1.4, requiring lawyers to keep clients reasonably informed about the status of their legal matters and promptly comply with reasonable requests for information.

In three client matters, Mr. Burns knowingly endorsed settlement checks for his clients without the clients' knowledge or consent, negotiated the checks with forged endorsements, and intentionally converted the clients' funds to his own use. Mr. Burns' conduct violated RPC 8.4(b), prohibiting committing a criminal act (theft) that reflects adversely on the lawyer's honesty, trustworthiness or fitness as a lawyer in other respects; and RPC 8.4 (c), prohibiting engaging in conduct involving dishonesty, fraud, deceit or misrepresentation.

Mr. Burns failed to respond to the Office of Disciplinary Counsel's written requests for response in five matters. Mr. Burns' conduct violated RLD 2.8(a), requiring lawyers to promptly respond to any inquiry or request made for information relevant to grievances or other matters under investigation concerning a lawyer's conduct.

Jean McElroy represented the Bar Association. Mr. Burns represented himself. David Tuell was the hearing officer.

Gregory L. Samuels (WSBA No. 19497, admitted 1990), of Vancouver, B.C., Canada, has been suspended by order of the Supreme Court of Washington, dated February 11, 2000. The Supreme Court's order of reciprocal discipline, pursuant to RLD 12.6, is based on the Hearing Panel for the Law Society of British Columbia's October 8, 1999 order for a 90-day suspension. The Washington Supreme Court ordered that Mr. Samuels' Washington suspension run concurrently with the British Columbia suspension.

In 1996, Mr. Samuels represented two clients in an assault case in Delta Provincial Court. He intended to obtain diversion for these clients. In March 1996, The Crown advised Mr. Samuels that diversion would not be acceptable. In May 1996, three days prior to trial, Mr. Samuels applied to the Court to adjourn (continue) the trials. When it appeared that the Court would not grant the motion, Mr. Samuels told the Court that he had spoken with the clients' mothers, and implied that his contact was recent. In fact, Mr. Samuels had not contacted the clients' mothers for a considerable time prior to the hearing. Mr. Samuels later admitted to implying to the judge that he had recently spoken with his clients' mothers, knowing that this was inaccurate. Mr. Samuels wrote a letter of apology to the judge and made changes in his practice. Mr. Samuels' conduct was misleading and constituted professional misconduct.

Douglas J. Ende represented the Bar Association. Mr. Samuels represented himself.

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