In re Disciplinary Proceeding Against Hall

This opinion was flied for record
at "6~<.0 CtrcQ on J]A.lj to, 2.01 £{-

6fM
~onald R. Carpenter
Supreme Court Clerk

IN THE SUPREME COURT OF THE STATE OF WASHINGTON

In the Matter of the Disciplinary ) No. 201,255-8
Proceeding Against )
)
ALAN F. HALL, ) En Bane
)
an Attorney at Law. )
) Filed JUL 1 0 2014

C. JOHNSON, J.-Alan F. Hall appeals the unanimous recommendation of

the Washington State Bar Association Disciplinary Board (Board) that he be

suspended from the practice of law for two years. This disciplinary action concerns

Hall's creation and management of an elderly woman's estate. The hearing officer

held that Hall violated Rule of Professional Conduct (RPC) 1.4(b)

(communication), RPC 1.7(a)(2) (concurrent conflict of interest), RPC 1.8(a)

(improper business transaction with a client), RPC 1.5 (unreasonable fees), RPC

8.4( c) (dishonest conduct), RPC 1.15A(f) (return of client property), RPC 1.16(d)

(termination of representation), and RPC 8.4(d) (conduct prejudicial to the

administration ofjustice). We hold that the hearing officer's conclusions oflaw are
In re Disciplinary Proceeding Against Hall, No. 201,255-8

supported by the unchallenged findings of fact. We accept the Board's unanimous

recommendation and suspend Hall from the practice of law for two years.

FACTS AND PROCEDURAL HISTORY

In July 2008, Stephen Keen and his mother Margaret Keen hired Hall to

prepare Margaret's estate planning documents. Both Stephen and Margaret were

mentally competent but physically disabled. Stephen was 65 years old. Margaret

was 91 years old, had poor eyesight and difficulty reading, and was generally in

poor health. Hall had no prior relationship with the Keens. Stephen held power of

attorney over Margaret, with Margaret's other son as an alternate attorney in fact.

Margaret intended for Stephen to be the sole beneficiary of her estate. Hall drafted

an estate plan for Margaret that included a special needs trust (Trust), a will, a new

power of attorney, and a living will, and he charged the Keens a flat fee of $3,000,

which was paid in two installments by September 11, 2008.

The Trust was the beneficiary of Margaret's estate, and Stephen was the sole

beneflciary of the Trust. The Trust was created to protect Stephen's government

beneflts in the event that, upon Margaret's death, he received Margaret's entire

estate, valued at approximately $400,000. Margaret was named trustee of the Trust,

and Hall was named as successor trustee in the event that Margaret could not

continue as trust~e. Further, the Trust provided that as trustee, Hall would be

2
In re Disciplinary Proceeding Against Hall, No. 201,255-8

compensated at $8,000 per year or two percent of the corpus of the Trust,

whichever was greater, and would be able to hire himself as an attorney for the

Trust~ billing the Trust at his hourly rate in addition to his trustee's fees.

Margaret's will appointed Stephen as the executor but named Hall as

successor executor in the event Stephen could not serve as executor. Like the

Trust, the will also provided that as executor, Hall could hire himself as an attorney

for the estate and bill at his hourly rate. Margaret's living will appointed Stephen

as Margaret's health care representative and Hall as an alternate health care

representative if Stephen was unable or unavailable. In that role, Hall had the

power to disclose Ivlargaret's medical records, arrange for her admission to a

hospital or other medical facility, arrange for prescription drugs and procedures,

and consent to a "Do Not R~suscitate" order. Finally, the durable power of attorney

appointed Stephen as lVIargaret's agent and Hall as alternate agent.

Hall compiled the estate planning documents into a packet that was provided

to the Keens on September 3, 2008. Also included in this packet was an

engagement letter prepared by Hall. The letter included a provision entitled

"Informed Consent" whereby Margaret purportedly consented to the conflict of

interest created in Hall becoming successor trustee and successor executor of

Margaret's estate and being able to hire himself for legal work. Resp't's Ex. R-

3
In re Disciplinary Proceeding Against Hall, No. 201,255-8

101, at 1073. On October28, 2008, Margaret executed the estate documents.

Knowing. that Margaret had poor eyesight and difficulty reading, Hall explained

some of the provisions in the estate plan and some concepts behind those

provisions but he did not read the documents to Margaret word for word. Margaret

initiitled every page of these documents and duly executed the Trust, will, living

willj and durable power of attorney. The will and the Trust also each contained a

provision whereby IV[argaret purportedly consented to the conflict of interest

created in Hall being able to hire himself for legal work and bill the Trust and the

estate :for legal fees.

On December 28, 2008, Hall wrote a "Memorandum to Trustee Explaining

Special Needs Trust." Resp't's Ex. R-110, at 1560. This memo was addressed from

himself and to himself. It stated, "You have been appointed as the Trustee of the

Special Needs Trust established by Settlor for the benefit of Stephen Keen," and it

set out ~he duties ofthe trustee as well as the trustee's compensation of$2,000 per

quarter. R.esp't's Ex. R-110, at 1560; see Clerk's Papers at 408. Hall billed $185

for pr~paring this memorandum and another $185 for reviewing it the next day. On

December 29, 2008, Stephen paid Hall $2,050, and Hall used $49 dollars of the

4
In re Disciplinary Proceeding Against Hall, No. 201,255-8

$2,050 to fund the Trust. Atno time did the Trust corpus exceed $49. 1 Hall kept

the $2,000 as the quarterly fee for acting as trustee of the Trust. Margaret,

however, was still the legal trustee of the Trust.

On January 7, 2009, only two months after the Trust was created, Margaret

executed a "declination to serve as trustee of the Stephen Keen special needs

trust," which appointed Hall as trustee and gave him absolute discretion to manage

the Trust. Ass'n's Ex. 1. By Hall's own admission, Margaret was not competent to

act as trustee.

In March 2009, Stephen was looking to move to an assisted living facility

and met with an elder care consultant, Victoria DeVine. Devine reviewed the

Keens' estate planning documents and pointed out the many roles Hall had in

managing Margaret's estate and affairs. DeVine referred Stephen to attorney Jamie

Clausen. Clausen confirmed all of Hall's roles in Margaret's estate, a fact which

surprised and upset the Keens. Upon their request, Clausen drafted new estate

planning documents and read them aloud to Margaret. Margaret then signed and

executed the documents, revoking the prior documents drafted by Hall.

1
Accordingly, at no time did two percent of the Trust corpus exceed $0.25. That Hall
received $2,000 rather than two percent of the corpus of the Trust was dictated by the
compensation provision Hall drafted into the Trust.

5
In re Disciplinary Proceeding Against Hall, No. 201,255-8

Clausen then sent Hall a certified letter informing him that ( 1) the Keens had

hired her to execute new estate planning documents for them, (2) the documents he

had drafted had therefore been revoked, and (3) the Keens requested that Hall

return the original documents and the fee he was paid. Hall refused to return the

documents or fee, or acknowledge that his services as the Keens' lawyer had been

terminated.

Stephen filed a grievance with the Washington State Bar Association

(Association) on November 6, 2009. In late February 2010, Hall sent a letter to the

Association demanding that the Keens pay $4,273.25 owed to him "under the trust

agreement'' and stating that he was entitled to "$2,000 per month since the creation

of the trust." 2 Ass'n's Ex. 29, at 1. After multiple requests, Hall also finally

forwarded his original file to the Association but requested that the file be returned

because he intended to sue Stephen and Clausen for statements made to the

Association.

On May 25, 2010, Hall made an unannounced evening visit to Clausen's

residence·---which also served as her place of business-where Clausen was with

her husband and infant daughter. In a loud, angry voice, Hall called Clausen an

idiot and told her that she had committed malpractice, that she was in "big trouble"

2
· Hall also sent a similar billing statement directly to Stephen, threatening collections.

6
In re Disciplinary Proceeding Against Hall, No. 201,255-8

and needed to "fix the problem," and that she was going to get disbarred. 1

Verbatim Tr. of Proceedings (VTP) at 198. Clausen threatened to call the police,

and Hall finally backed off, mentioning that Clausen "had a lot to lose ... a new

baby and a young family and a big house" and that if he went down, she would go

down. 1 VTP at 200. Hall then sent a letter to Clausen containing random

references to Communist Russia and Nazi Germany and threatening to file a

lawsuit against her. Hall was removed as trustee of the Trust on May 28, 2010, but

he still refused to return the original documents and continued to accuse Clausen of

malpractice.

The Association filed a four-count complaint, alleging a conflict of interest,

unreasonable fees, and conduct prejudicial to the administration of justice, among

other things. A disciplinary hearing was initiated in August 2011, but Hall asserted

that he suffered a mental or physical incapacity and was unable to proceed in his

disciplinary hearing. He was suspended on August 18, 2011, on an interim basis by

this court pending the outcome of his disability proceeding. His disciplinary

proceeding resumed on February 25, 2013, and on March 31, 2013, the hearing

officer held that Hall committed all of the charged violations, with seven

aggravating factors and no mitigating factors. The hearing officer recommended

that Hall be suspended from the practice of law for two years, a decision which

7
In re Disciplinary Proceeding Against Hall, No. 201,255-8

was unanimously adopted by the Board. Hall now challenges his suspension in this

court.

ANALYSIS

This court gives considerable deference to a hearing officer's findings of

fact, and we uphold the hearing officer's conclusions of law ifthey are supported

by the findings of fact. Unchallenged findings of fact are treated as verities on

appeal, while challenged findings of fact are upheld if supported by substantial

evidence. In re Disciplinary Proceeding Against Marshall, 167 Wn.2d 51, 66-67,

217 P.3d 291 (2009). Under Rule of Appellate Procedure (RAP) 10.3(g),

[a] separate assignment of error for each finding of fact a party
contends was improperly made must be included with reference to the
finding by number. The appellate court will only review a claimed
error which is included in an assignment of error or clearly disclosed
in the associated issue pertaining thereto.

Hall claims that he is challenging the hearing officer's findings of fact and

thus such findings should not be treated as verities on appeal. The Association,

hO\vever, points out that because Hall did not assign error to specific findings of

fact by number, he has not satisfied the requirements of RAP 10.3(g) and thus he is

not actually challenging the hearing officer's findings of fact for purposes of this

court's review. Although Hall does not specifically identify the findings of fact he

claims to be challenging, this court can waive technical violations of the RAP

8
In re Disciplincuy Proceeding Against Hall, No. 201,255-8

under appropriate circumstances. But Hall's arguments, although labeled as

challenges to the findings of fact, are more appropriately characterized as

challenges to whether the facts support the hearing officer's conclusions of law,

not challenges to the veracity of those facts. Thus, our review is ultimately de novo

and we will uphold the Board's decision if it is supported by the hearing officer's

findings of fact. Each of the four charged counts will be discussed in turn.

Count 1: Conflict ofInterest

RPC 1.4(b) provides that a lawyer "shall explain a matter to the extent

reasonably necessary to permit the client to make informed decisions regarding the

representation." RPC 1.7(a)(2) provides that a lawyer "shall not represent a client

if ... there is a significant risk that the representation of [a client] will be

materially limited by ... a personal interest of the lawyer." Finally, RPC 1.8(a)

provides that

[a] lawyer shall not ... knowingly acquire an ownership, possessory,
security or other pecuniary interest adverse to a client unless:
( 1) the transaction and terms on which the lawyer acquires
the interest are fair and reasonable to the client and are fully
disclosed and transmitted in writing in a manner that can be
reasonably understood by the client;
(2) the client is advised in writing of the desirability of
seeking and is given a reasonable opportunity to seek the advice of
independent legal counsel on the transaction; and
(3) the client gives informed consent, in a writing signed by
the client, to the essential terms of the transaction and the lawyer's

9
In re Disciplinary Proceeding Against Hall, No. 201,255-8

role in the transaction, including whether the lawyer is representing
the client in the transaction.

The hearing officer held that Hall violated these RPCs because he named

himself as alternate trustee and health care representative, and gave himself power

of attorney without fully explaining to the Keens the legal effects of these roles,

including the ways in which these roles could conflict with his own interests and,

in turn, adversely afiect their interests. 3 This conclusion is supported by the facts.

Being in control of Margaret's assets was in Hall's personal interest and thus

there was a significant risk that his representation of the Keens could be limited by

this interest. Further, there is substantial evidence that Hall did not obtain informed

consent to his acquiring a pecuniary interest in Margaret's estate in the form of an

$8,000 per year trustee's fee. Hall argues that the waiver provisions in his

engagement letter and the will and Trust were sufficient to serve as informed

consent. These waiver provisions, however, only purportedly waive the conflict

created in Hall being able to hire himself for legal work for the Trust and/or the

estate. They do not explain whether Hall was representing the Keens or himself in

appointing himself to these roles, as is required by RPC 1.8(a)(3). There was also

substantial evidence that Margaret had difficulty even reading the documents she

3
. It does not appear that the hearing officer found a violation in Hall appointing himself
successor executor of Margaret's estate.

10
In re Disciplinary Proceeding Against Hall, No. 201,255-8

~igned and that Hall failed to read them out loud, word for word. Finally, informed

consent also requires "adequate information and explanation about ... reasonably

available alternatives to the proposed course of conduct." RPC 1.0(e). Here, expert

witness Barbara Isenl10ur testified at the hearing that professional trust agencies are

a much better option than attorneys because they are more knowledgeable and

cheaper. There is no indication that Hall informed the Keens, in writing or

otherwise, of such a reasonable alternative to appointing himself as future trustee.

Hall argues that Margaret requested that he serve in these various roles in

her estate plan. Unfortunately, Hall provides no citation to the record to support

this claim and instead refers to his own self-serving testimony. The hearing officer

was unconvinced and did not make such a finding of fact. The hearing officer's

findings of fact support the conclusion that Hall violated RPC 1.4(b), RPC

1.7(a)(2), and RPC 1.8(a). We affirm the Board as to this count.

Count 2: Unreasonable Fees

Under RPC 1.5(a), a lawyer "shall not make an agreement for, charge, or

collect an unreasonable fee or an unreasonable amount for expenses." Further,

under RPC 8.4(c), it ~s professional misconduct for an attorney to "engage in

conduct involving dishonesty, fraud, deceit or misrepresentation." The hearing

officer concluded that Hall violated these RPCs in (1) charging a $2,000 quarterly

11
In re Disciplinary Proceeding Against Hall, No. 201,255-8

tr~stee fee f9r managing a trust corpus that never exceeded $49, (2) charging for

management of the Trust before he was legally trustee, (3) charging for drafting a

letter to himself, and (4) charging an hourly rate for trustee duties for which the

quarterly flat fee already compensated him. This conclusion is supported by the

facts.

Hall charged and collected the $2,000 quarterly trustee fee from Stephen in

December 2008, but Margaret was the legal trustee until January 2009. Hall,

therefore, was not legally entitled to collect this fee. With regard to the hourly fees

he charged in December 2008, Hall argues that he was "made aware" in December

2008 that Margaret would no longer be able to serve as trustee. Pet'r's Reply Br. at

6. I-lis work before January 2009 was not work performed as trustee, but rather

work done "in preparation for his duties as trustee, in addition to ... general legal

work on the estate plan." Pet'r's Reply Br. at 6. However, Hall had already been

compensated.':rith the $3,000 flat _fee he received for preparing Margaret's estate

planning documents. Because he was notlegally trustee in December 2008, he

could not hire himself to perform legal work for the Trust or the estate. He was

therefore not .entitled to collect these fees as either an attorney or a trustee.
.

Finally, with regard to his charge for writing and reviewing a memo to

himself, Hall argues that this document was originally written and sent to

12
In re Disciplinary Proceeding Against Hall, No. 201,255-8

Margaret, at no charge, when she was trustee in September 2008. The memo was

later readdressed to himself (without changing the dates) in December 2008 when

he claims the Keens instructed him to replace Margaret as trustee. The hearing

officer did not find this testimony credible. Further, a "no charge" for this alleged

September 2008 letter should have appeared in his billing records like his other "no

charge" entries, but no such entry exists. See Ass'n's Ex. 19. The facts support the

hearing officer's conclusion that Hall violated RPC 1.5 and RPC 8.4(c), and we

affirm as to this count. 4

Count 3: f?ailure To Return Original Documents

RPC 1.15A(f) provides that "a lawyer must promptly pay or deliver to the

client or third person the property which the client or third person is entitled to

receive." RPC 1.16(d) provides that

[u]pon termination of representation, a lawyer shall take steps to the
extent reasonably practicable to protect a client's interests, such as ...
smTendering papers and property to which the client is entitled and
refunding any advance payment of fee or expense that has not been
earned or incurred.

The hearing officer concluded that Hall violated these RPCs when Hall refused to

return the Keens' original estate planning documents after receiving Clausen's

4
We note that it is especially egregious for a lawyer to charge a fee not only for time
spent drafting a letter to himself but also for time spent reading and reviewing that letter. This act
itself supports the hearing officer's conclusion that the RPCs were violated.

13
In re Disciplinary Proceeding Against Hall, No. 201,255-8

letter stating that the originals had been revoked and that the Keens were

requesting the file. The facts support this conclusion.

The hearing officer concluded that Clausen's certified letter to Hall

requesting return of the Keens' original estate planning documents and Hall's fee

was. sufficient to terminate Hall's representation of the Keens. Hall then had the

ethical obligation to return the Keens' file upon their request. Instead of

challenging the hearing officer's findings of fact, Hall argues that he was

protecting the Keens' interests because he feared that Clausen was committing

elder abuse. Hall, however, provides no support in the record for such a

proposition and the hearing officer made no finding of fact in this regard. Further,

·withholding the originals for the purposes of initiating a lawsuit against his clients

is not a good means of protecting their interests. The facts support the hearing

officer's conclusion that Hall violated RPC 1.15A(f) and RPC 1.16(d), and we

affirm as to this count.

Count 4: Conduct Prejudicial to the Administration of Justice

It is professional misconduct for an attorney to "engage in conduct that is

prejudicial to the administration of justice." RPC 8.4( d). The hearing officer

concluded that Hall violated this RPC when he threatened Clausen if she did not

withdraw the grievance filed against him and when he threatened a lawsuit against

14
In re Disciplinary Procee(J;ng Against Hall, No. 201,255-8

Stephen and Clausen for providing information to the A~sociation. The facts

support this conclusion .

. Hall argues that he threatened only to expose Clausen's elder abuse. This is

not supported in the record, and the hearing officer made no such :finding of fact.

Hall also argues that RPC 8.4( d) proscribes only physical interference in the

administration of justice or violations of practice norms, citing In re Disciplinary

Proceeding Against Carmick, 146 Wn.2d 582, 597, 48 P.3d 311 (2002). Even

though there was no physical interference, however, it is certainly against practice

norms to show up unannounced at another attorney's home and threaten her and

her family to withdraw a grievance she did not :file. We affirm as to this count.

Sanction Analysis

In determining the appropriate sanction in attorney discipline matters, we

look to the American Bar Association's Standards for Imposing Lawyer Sanctions

(1991 & Supp. 1992). We :first consider the ethical duty violated, the attorney's

mental state, and any injury or potential injury caused by the attorney's conduct.

Then, we consider any aggravating or mitigating circumstances that may alter that

presumptive sanction. An attorney's mental state is an issue of fact best left to the

hearing officer. In re Disciplinary Proceeding Against Anschell, 149 Wn.2d 484,

501, 69 P.3d 844 (2003).

15
In re Disciplinary Proceeding Against Hall, No. 201,255-8

In this case, the hearing officer determined that under the applicable

standards, the presumptive sanction for each of Hall's four counts was suspension.

Hall's only relevant arguments as to these presumptive sanctions concern his

mental state. He claims that any technical violation on his part was negligent rather

than knmving, but he provides no citation to the record or any reason to disrupt the

hearing officer's determinations in this regard.

The hearing officer found seven aggravating circumstances that justified

Hall's suspension for two years, including (a) prior disciplinary offenses\ (b)

dishonest or selfish motive, (h) vulnerability of the victim, and (i) substantial

experience in the practice of law. 6 STANDARDS std. 9.22. Hall argues that the

hearing officer ignored multiple mitigating circumstances, including (b) absence of

a_ dishonest or selfish motive, (c) personal or emotional problems, and (m)

remoteness of prior offenses. STANDARDS std. 9.32. But Hall provides no support

for these mitigating factors; he merely lists them.

Finaliy, Hall argues that the Board erred in adopting the hearing officer's

recommendation of a two-year suspension. Under Rule for Enforcement of Lawyer

5
Hall was reprimanded in 2005 for failing to communicate with a client, provide
competent representation, or act with diligence, among other things.

6
Hall was admitted to the practice oflaw in 1974.

16
In re DisCiplinary Proceeding Against Hall, No. 201,255-8

Conduct (ELC) 13.3, a suspension cannot exceed three years. Hall argues that

because he was suspended on an interim basis from August 20 11 until the hearing

officer's ruling in March 2013, his two-year suspension following the hearing

extended his total length of suspension for more than four years, in violation of

ELC 13.3. Hall's suspension in 2011, however, was pursuant to ELC 7.3 because

Hall himself asserted that he was incompetent to represent himself in his own

disciplinary proceeding. A suspension under ELC 7.3 is meant to protect the public

from an attorney who is incompetent. A suspension under ELC 13.3, however, is

meant as a sanction for attorney misconduct. They are two different rules applying

to two different kinds of suspension. As the Association points out, allowing a

suspension under ELC 7.3 to offset a suspension under ELC 13.3 would protect

lawyers who assert their own incompetence from being punished for their

misconduct. Accordingly, Hall's two-year suspension does not violate ELC 13.3.

17
In re Disciplinary Proceeding Against Hall, No. 201,255-8

CONCLUSION

The hearing officer's conclusions of law were supported by the

unchallenged findings of fact. We affirm the Board's unanimous decision and

suspend Hall from the practice of law for two years.

WE CONCUR:

:}o,M Jvvwi, +I 9,-·-
U~.-¢:

18