Schafer Law Firm
Washington Building, Suite 1302
1019 Pacific Avenue
P.O. Box 1134
Tacoma, Washington 98401-1134
(253) 383-2167 (Fax: 572-7220)November 12, 1997
Julie Anne Shankland, Disciplinary Counsel
Washington State Bar Association
2101 - 4th Ave., 4th Floor
Seattle, WA 98121-2330Re: Grievance of James Nehser against lawyer Gerald Neil.
WSBA File: 9500969Dear Ms. Shankland:
I enclose selected excerpts from the criminal case file of Susan M. Rogers (Pierce County Superior Court No. 94-1-01359-1). She was the "case manager" in Gerald Neil's office who handled Mrs. Nehser's case. These excerpts consist of (a) a pre-sentence evaluation report stating that Ms. Rogers had no post-high school training, and that she and all of her friends were drug and alcohol abusers; and (b) letters from Mr. Neil describing his guardianship practice. Some of the statements he made in that case seem to me to be directly contrary to some that he has made in connection with your investigation. Please read these carefully and consider the public interest.
In considering the public interest, you should recognize that (for whatever reasons) the Pierce County Superior Court bench has demonstrated no interest whatsoever in properly monitoring its favored home-town guardian. (I have no proof of corruption, but my experience leads me to believe the Bench's malfeasance concerning Mr. Neil is tainted at least by what I would label "Relationship-based Corruption.") So, do not expect the Pierce County Superior Court Bench to do anything. It's up to you to protect the public!
EnclosuresVery truly yours,
Douglas A. Schafer
cc: Mr. James H. Nehser
Schafer Law Firm
Washington Building, Suite 1302
1019 Pacific Avenue
P.O. Box 1134
Tacoma, Washington 98401-1134
(253) 383-2167 (Fax: 572-7220)October 29, 1998
Tim Leachman, Disciplinary Counsel
Washington State Bar Association
2101 - 4th Ave., 4th Floor
Seattle, WA 98121-2330Re: Grievance of James Nehser against lawyer Gerald Neil.
WSBA File: 9500969Dear Mr. Leachman:
This is in response to your letter of 9/29/98 forwarding to me Mr. Harkins' letter to you of 9/21/98. Mr. Harkins requests a deferral of this disciplinary proceeding, pursuant to RLD 2.4(d)(2), pending resolution of a civil case filed against Mr. Neil by James Nehser as personal representative the estate of his late mother, Alice Nehser. On behalf of Mr. Nehser, on behalf of the legal profession, and on behalf of the general public, I urge you to deny the deferral request.
RLD 2.4(d)(2) empowers the Review Committee to defer "an investigation into an alleged act of misconduct" when similar allegations are at issue in a pending civil or criminal case "where it appears that such deferral will not endanger the public." (Emphasis added.) The investigation of this grievance has concluded; only the disciplinary hearing remains. The record reflects that in 1995 Mr. Neil claimed that the guardianship part of his practice (that he calls "Pacific Guardianship Services") had 227 guardianship cases being administered by his 8 assistants. The record reflects the discovery in 1994 that Mr. Neil's apparent lack of careful supervision over his young assistant who managed the Nehser Guardianship (billed out at $65/hour though she had no post-high school education or training) enabled her to write 57 checks to herself, stealing over $35,000 from 15 of Mr. Neil's other incapacitated wards. The record reflects that Mr. Neil and his assistants sadly mishandled the late Mrs. Nehser's affairs, failing to take charge of her brokerage account, losing track of her certificate of deposit, and failing to claim her available benefits under her nursing home insurance policy. The only thing it appears that Mr. Neil and his staff carefully kept track of were their billable hours.
The Complaint alleges that Mr. Neil not only failed to adequately supervise his staff, but may himself have engaged in conduct involving dishonesty, fraud, deceit or misrepresentation. It seems apparent that the public is endangered if a person responsible for the lives and life savings of over 200 incapacitated persons not only fails to adequately supervise his assistants but himself commits acts of dishonesty.
The WSBA has for many years been trying to defend itself from justifiable criticism that its lawyer disciplinary system is inadequate. If a deferral of Mr. Neil's proceeding is granted, his case may well be used by WSBA critics as illustrating the WSBA's continued inadequacy. The alleged misconduct occurred from 12/94 to 2/95. The Nehser family first learned of it in 3/95. The grievance promptly was filed on 6/7/95. It took the Bar's assigned disciplinary counsel over two and one-half years to recommend disciplinary action to the Review Committee, which agreed to that recommendation 10 months ago. It now has been about three and a half years since this grievance was filed, and to my knowledge there is not yet even a hearing officer assigned or hearing date set.
Jim Nehser recognized that the Estate's private claims against Mr. Neil were subject to a 3-year statute of limitations, and he filed a civil complaint in 3/98 to preserve those claims on the eve of the running of that statute of limitations. Mr. Neil's attorney, Mr. Harkins, had indicated by his letter of 11/21/97 to disciplinary counsel that he was holding $3,514 in restitution funds for the Nehser Estate. The dollar amount of the private claim between the Nehser Estate and Mr. Neil is relatively insignificant. What is very significant -- and what motivated the Nehser family to file this grievance against Mr. Neil -- is the heightened protection of the elderly and disabled population of Pierce County that likely will result from exposing Mr. Neil's misconduct. It is reasonable to assume that as a result of this proceeding the Pierce County Superior Court will be more cautious in appointing him or his business as a guardian and will more closely scrutinize his accountings and actions as a guardian. That is appropriate, for no guardian (no matter how collegial with the local judiciary) should be above prudent judicial scrutiny.
Mr. Harkins' letter of 9/21/98 requesting the deferral of this proceeding cites Discipline of Gillingham, 126 Wn.2d 454 (1995), where at footnote 3 the Court in dicta described as "sensible" a perceived bar policy (for which the Court cited no published rule) to defer disciplinary proceedings when a civil proceeding is pending addressing the same issues. Such a policy appears "sensible" if disciplinary proceedings are viewed as simply an alternative nonjudicial forum to resolve a private claim between a lawyer and the grievant. However, I had understood (though I cannot cite a RPC or RLD provision) that an important purpose of lawyer discipline was to protect the general public from the harm that can be caused by a dishonest or otherwise unethical lawyer. (APR 3(e) does require "good moral character" for admission to the bar.)
Recently, the Washington Supreme Court rejected an argument that rested on the premise that a lawyer disciplinary proceeding is simply an alternative nonjudicial forum to resolve a private claim between a lawyer and a client. The lawyer featured in Discipline of Dann, 136 Wn.2d 67 (1998), argued that he should not be disciplined for overbilling clients who had learned but not complained about it. The Court, at footnote 3, rejected that argument and its premise (that only a client's interests are impacted by his misconduct) saying, "The injury is as much to the image of the legal profession as it is to the individual client." Similarly, here the injury from Mr. Neil's misconduct is as much to the image of the legal profession (reinforcing the public's perception of lawyers as greedy bastards) as it is to the Nehser family.
Please do not merely deny the requested deferral of this proceeding, but do what you can to expedite the handling of it. The continuing delay in the prosecution of this case continues to endanger the general public and further damages the desired image of the WSBA disciplinary system and of the legal profession. Thank you.
cc: Mr. James H. NehserVery truly yours,
Douglas A. Schafer
Schafer Law Firm
Washington Building, Suite 1302
1019 Pacific Avenue
P.O. Box 1134
Tacoma, Washington 98401-1134
(253) 383-2167 (Fax: 572-7220)July 14, 1999
Tim Leachman, Disciplinary Counsel
Washington State Bar Association
2101 - 4th Ave., 4th Floor
Seattle, WA 98121-2330Re: Grievance of James Nehser against lawyer Gerald Neil.
WSBA File: 9500969Dear Mr. Leachman:
Thank-you for finally providing me yesterday a copy of the 3/6/98 Declaration of Rose Heuck, Mr. Neil's former assistant (1 of 8). I had been seeking it since 11/24/97 when she told me that she would be providing a declaration to Ms. Shankland.
My purpose in writing is to convey to the Disciplinary Board the basis for my strong belief that Mr. Neil was personally, directly involved in deciding how to handle the discovered $6,455 CD and how to "paper the file" to make it appear legitimate. I consider that conduct to have violated RPC 8.4(c)(dishonesty, fraud, deceit, or misrepresentation). In letters to Ms. Shankland of 10/7/97 and 10/14/97, Mr. Neil vigorously denied such misconduct, admitting only to negligent supervision of his staff. [When I refer below to a document for which I have the Bates-stamp number (e.g., #000174) from your public investigation files, I will provide it.]
As I have been denied access to Mr. Neil's proposed stipulations to discipline (though you had assured me by your 2/22/99 letter that I would have such access), I do not know whether Mr. Neil is stipulating to any violation of RCP 8.4(c)(dishonesty, fraud, deceit, or misrepresentation). Given that Mr. Neil has enjoyed a near-monopoly of court-appointed guardianship work in Pierce County in recent years (his 1/25/95 letter boasted of 227 guardianship cases being handled by his 8 assistants), and given the many, many complaints that I (as an outspoken critic of the local guardianship system) have received from persons whose lives he's touched, I consider it vital to the protection of the public that his misconduct and mishandling of the Alice Nehser Guardianship be fully exposed.
In Mr. Neil's initial responses to this grievance (letters of 7/12/95 and 12/19/95), he denied that Pacific Guardianship Services ("PSG") was "part of his law practice" and said it was an error for Ms. Heuck to have made that representation to Seafirst Bank when she requested the CD proceeds by her letter of 1/30/95. Mr. Heuck's Declaration (¶6, ¶8) indicates that she used a pre-approved office "form letter" when she requested the CD proceeds. The "erroneous" representation (that PGS is part of Mr. Neil's law practice) also appeared in earlier "form letters" that Mr. Neil signed and sent to Seafirst Bank (3/26/93, #000276; 11/2/92, #001015). Further, Mr. Neil acknowledged that "all the employees of PGTS are actually employees of Gerald W. Neil, P.S." in his 1994 letters concerning the prosecution of one of his case managers, Ms. Rogers, that I forwarded to Ms. Shankland with my letter of 11/12/97.
Evidence of Mr. Neil's direct personal involvement in the handling of the CD is described in my letter to Ms. Shankland of 10/29/97 and papers enclosed with it that I obtained from Alice Hill of DSHS, together with the law firm's billable time records printout of 1/30/95 (#000996 to #001000) that Mr. Harkins submitted to Ms. Shankland with his 1/22/96 letter. The time records suggest that Rose discovered the overlooked CD on 1/11/95 and had an "office conference." Mr. Harkins letter of 10/14/97 said that conference was with Mr. Neil's office manager, Pamela M. Davidson. The firm also had received a letter from Seafirst Bank dated 11/18/94 (#000640) concerning the Nehser CD. The record includes Ms. Davidson handwritten and initialed note on attention-getting colored papers (#000174) reporting the discovery of the overlooked CD--presumably reporting it to Mr. Neil, the only lawyer responsible for the 8 non-lawyer assistants.
Records from Alice Hill of DSHS indicate that Rose first phoned her on 1/12/95 to report the discovered Nehser CD and inquire about amounts owed to DSHS. Alice's phone notes show that on 1/26/95, Rose told her: "not sure if they will probate or if will be able to just turn over funds." Alice's notes from Rose's phone call of 1/30/95 indicate "they will not be probating." Clearly, somebody other than Rose was making the key decisions.
A billable timeslip entry for Gerry Neil entered on 1/30/95 for 4.0 hours indicates that he personally was spending significant time on the matter. That is consistent with Rose Heuck's unequivocal statement to me in my first phone conversation with her on 11/10/97 that "Mr. Neil decided what to charge."
Mr. Neil was the only lawyer in the office at that time (along with his 8 assistants), and I consider it inconceivable that he would not have been fully aware of the discovery of the overlooked Nehser CD during the three or more weeks that they were dealing with it. Rose Heuck's Declaration (¶ 10) denies involvement in the Nehser case "after the bank sent the money to the law offices." That denial is consistent with the conclusion in my letter to Ms. Shankland of 10/29/97 that persons other than Ms. Heuck (more likely Ms. Davidson and Mr. Neil) had prepared the Small Estate Affidavit. Mr. Neil signed the Affidavit and Ms. Davidson notarized it.
The Small Estate Affidavit was prepared simply to give an appearance of legitimacy to the misappropriation of the CD, for Mr. Neil already had obtained possession of the CD proceeds by the time he signed the Affidavit. The purpose of the Uniform Probate Code small estate procedure that has since 1974 been codified as RCW 11.62.010 and -.020 is to enable the successors to a decedent's small estate to obtain possession of the decedent's assets by delivering a prescribed affidavit to the holder of the asset. Upon receipt of the affidavit, the holder may safely deliver possession of a small estate asset to the successor claiming the right to it in the affidavit. The affidavit is filed nowhere, but retained by the holder to justify having turned over the asset to someone other than a court-appointed personal representative.
Mr. Neil did not deliver the Small Estate Affidavit to Seafirst Bank, nor did he file it anywhere. He prepared it and retained it simply to attempt to give an appearance of legitimacy (to the uninformed) to his having quietly "grabbed" the Nehser CD proceeds without informing the heirs or the Court, or following any lawful procedures.
One of the most troubling aspects of this matter is that it appears to me that Mr. Neil may have caused Ms. Rose Heuck to give false testimony. After I first located Ms. Heuck in Washington D.C., by inquiring of the command at McChord Air Force Base (as her husband is an Air Force Academy graduate pilot), she unequivocally indicated in our phone conversation of 11/10/97 that Mr. Neil had been directly involved in dealing with the CD. She agreed to meet with me during her upcoming 4-day family visit in this area scheduled to begin 11/20/97. She then called me on 11/24/97 and declined to meet, saying that she had spoken to Ms. Shankland (as I had urged her to do) and would be giving her a written statement. Shortly thereafter, Mr. Neil indicated to a local News Tribune reporter, John Gillie, that my actions in locating Ms. Heuck through military channels might jeopardize her husband's military career. I would not be at all surprised if Mr. Neil also communicated to Ms. Heuck the suggestion that that or other adverse consequences might result from any adverse testimony that she might give in his disciplinary case.
I note that Ms. Heuck's Declaration (¶10) that she "was not involved in this case after the bank sent the money" is directly contradicted by her 2/7/95 letter to Alice Hill forwarding the client trust account ledger card that she prepared (compare her distinctive handwriting on the dateline of her Declaration with the ledge card) showing that day's deposit of the Seafirst check and that day's disbursement of its full amount by three checks--two to Mr. Neil and one that she sent with her letter to DSHS. The latter, Check 2512, was clearly prepared by Ms. Heuck and signed by Mr. Neil, and most likely the other two were as well.
I further note, from Ms. Heuck's distinctive handwriting, that she prepared the false affidavit by which Mr. Neil claimed Ms. Nehser's post-death retirement benefits in January 1994 notwithstanding his discharge by the Court in the previous month. I sent that affidavit and associated papers to Ms. Shankland with my letter of 10/6/97. Perhaps Ms. Heuck had reasons to hope this proceeding would be dismissed quietly.
My final comment is that I hope and expect that Disciplinary Board member Bryce H. Dillie (of the Pierce County firm of Campbell, Dillie, and Barnett ("CDB")) will recuse himself from Mr. Neil's disciplinary proceeding. My recollection is that he and his firm sought and achieved Mr. Neil's appointment in 1994 as guardian of Mike Barovic (who thereupon died) and have been "allies" with Mr. Neil, who succeeded as administrator of his estate, ever since then on all contested matters (including CDB's $89,700 fee request). I expect that Mr. Dillie's firm has sought Mr. Neil's or PGS's appointment in many other guardianship cases, as well.
Thank you for ensuring that the Disciplinary Board considers this letter.
cc: Julie Shankland, Clerk/Counsel to Disciplinary BoardVery truly yours,
Douglas A. Schafer
Mr. James H. Nehser