Conduct of Robeson, In re

Decision Date05 October 1982
Citation652 P.2d 336,293 Or. 610
PartiesIn re Complaint as to the CONDUCT OF Vincent G. ROBESON, Accused. OSB 79-22; SC 28197. . *
CourtOregon Supreme Court

Jack H. Cairns, Portland, argued the cause for the Accused. Vincent G. Robeson, Lake Oswego, filed the brief.

Margaret H. Leek Leiberan, Portland, argued the cause for the Oregon State Bar. With her on the brief was Ron D. Bailey, Portland.

PER CURIAM.

The Oregon State Bar filed an amended complaint against Vincent G. Robeson accusing him of unethical conduct in nine separate causes. All causes of action allege that Robeson was guilty of unethical conduct in that he violated the Disciplinary Rules of the Oregon State Bar and the Oregon Revised Statutes in his dealings with his client, Ruth Merwin, during 1976.

Robeson has been a member of the Oregon State Bar since 1964. An interoffice memo of a bank listed Merwin's age in 1976 as 60. Merwin was the beneficiary of a revocable trust which she had created naming a bank as trustee. Immediately prior to Merwin's business transactions with Robeson the principal balance in the trust was $1,300,000. 1 This case is unique in that Merwin did not make the complaint to the Oregon State Bar, refused to take part in the proceedings, and would not release Robeson from the attorney-client privilege.

The Trial Board found Robeson guilty of five of the causes and not guilty of the remaining four causes. It recommended that Robeson be indefinitely suspended from the practice of law. 2 The Disciplinary Review Board found Robeson guilty of eight of the nine causes of complaint and recommended that he be permanently disbarred. We conclude that Robeson should be permanently disbarred.

Around 1970 Harold E. Davis, James R. McKie, and Robeson formed a corporation under the name of Davis, McKie & Robeson, Inc. The sole asset of the corporation was a tract of land with a potential for development in Clackamas County. 3 Davis, McKie and Robeson owned the stock of the corporation in equal shares. The corporation borrowed a sum of money which was used to buy additional land and to pay for the engineering fees necessary for a zone change. The debt and property were refinanced with Rainier Credit Company. The promissory note became in default. A foreclosure suit was settled on September 8, 1975 by Davis, McKie & Robeson, Inc. deeding the land to Rainier Credit who in turn gave back to the grantor an option to repurchase the property within one year for the sum of $100,000 plus interest, costs, attorney fees, title report fees and escrow fees.

Robeson began representing Merwin as her attorney in late 1974 or early 1975. On January 20, 1976 Merwin gave Robeson a cashier's check payable to him in the amount of $150,000. According to Merwin this money was to be used to purchase stock for her in the National Automatic Sprinkler Co., an Oregon corporation. 4 Robeson had been the company's lawyer. An employee of a bank testified that Robeson used the $150,000 cashier's check to purchase four other cashier's checks payable to himself and that none of the funds were deposited in his client's trust account. Sometime between January 20, 1976 and February 3, 1976 Robeson contacted National Automatic Sprinkler to buy stock on behalf of Merwin. The offer was refused.

On February 3, 1976, Robeson wrote a letter to National Automatic Sprinkler Co. tendering on behalf of himself and his wife a cashier's check in the sum of $135,000 for the purchase of 55% of the corporation's stock. The letter in part said:

"This investment would act as my retirement policy, in 20 years, the time that I would be 62, the investment should provide adequate income for retirement."

No mention was made of Merwin in the letter. The offer was refused.

At the hearing before the Trial Board Robeson claimed that he borrowed $150,000 from Merwin. There are no documents in the record to show that it was a loan. There is no evidence of security, terms of repayment or interest rate. When Robeson was specifically asked if there were any written agreements defining his relationship with Merwin in connection with the $150,000 he claimed the attorney-client privilege.

On February 17, 1976, Robeson and his wife used $120,618.03 of the funds received from Merwin to purchase in their own names the 17 acres of development land in Clackamas County from the Rainier Credit Company. As the land was subject to the option given to Davis, McKie & Robeson, Inc. to repurchase until September 8, 1976, it was necessary for Robeson to deal with Davis and McKie who owned two-thirds of the corporation. On March 19, 1976 by written contract, Robeson agreed to buy all the corporate stock of Davis and McKie for the sum of $100,000. The sum of $10,000 was paid down upon the execution of the agreement with the balance of $90,000 to be paid on terms.

Although the deed is not a part of the record, it is apparent from other documents that Robeson had caused the title of the 17 acres to be transferred to NOR-AM-CO, an Oregon corporation that had been incorporated on February 23, 1976. Robeson, his wife, and A.R. Kauffman (another business associate) were the sole stockholders of the corporation. The $90,000 balance due Davis and McKie became an obligation of the corporation.

On March 22, 1976, Robeson prepared a contract whereby NOR-AM-CO sold to Merwin and one Jerry W. Nicholson 240,000 square feet (5.5 acres) of the 17 acre tract of land for the sum of $336,000. Ten percent or the sum of $33,600 was the down payment. The contract provided:

"NOR-AM-CO hereby acknowledges an off-set of $150,000.00 against said purchase price which shall be off-set at the time of the plat approval. This is payment in full of a debt assumed by NOR-AM-CO from VINCENT G. ROBESON due to RUTH MERWIN."

The balance of the purchase price ($152,400) was to be paid when the plat was approved by the City of Lake Oswego.

On April 25, 1976, while Robeson and his wife were on vacation in Hawaii with Merwin, he obtained a $50,000 loan from Merwin. The check for the loan was made payable to NOR-AM-CO, which in turn, on April 28, 1976, issued its check in the same amount to Pacific International Forest Products, Inc., a corporation in which Robeson had an interest. Robeson's reasons for the loan are vague. 5 At the hearing before the Trial Board he testified:

"Well, again, items that gave rise to the loan would be, obviously, in my mind covered by the attorney client privilege. The fact is to solve the problems of Mrs. Merwin, a loan was offered, and I accepted it."

Under date of May 1, 1976, Robeson executed his personal promissory note to repay the loan in ten equal annual installments. Interest was to be paid at the rate of 10% per annum.

On July 20, 1976, Robeson, his wife, and Kauffman traded all of the outstanding stock of NOR-AM-CO to Merwin for 1,250 shares of U.S. Bancorp, 1,200 shares of Crown Zellerbach Corporation, and 722 2/3 (pre-split) shares of Caterpillar Tractor Company. The shares traded by Merwin had a fair market value of $146,408. Robeson prepared the agreement for the exchange of stock and by it Merwin acknowledged that NOR-AM-CO had an outstanding obligation to Davis and McKie in the amount of $90,000. Kauffman had been the owner of 25% of NOR-AM-CO's stock. 6

Also on July 20, 1976, as a supplement to the stock exchange agreement, Robeson, his wife and Kauffman promised Merwin that they would use the stock received from her as collateral to obtain a loan to pay Robeson's note to her of May 1, 1976 in the amount of $50,000. This was in fact done. The note is in the record marked paid in full as of July 27, 1976. No interest was paid.

On October 12, 1976, Merwin signed a guarantee and pledge agreement whereby she pledged 1,246 shares of Standard Oil of California as collateral for a loan from General Electric Credit Corporation to Pacific International Forest Products. Subsequently the stock was liquidated for the sum of $54,955 when Pacific International defaulted on the loan. Robeson claimed that the consideration to Merwin for making the pledge was an undocumented promise by Pacific International to make her a loan. Robeson explained as follows:

"A (Robeson) * * * So, Pacific International Forest Products then loaned Mrs. Merwin some money.

"Q (Bar's attorney) How much?

"A It was to be more than what she got, it was kind of as an as-needed basis. My recollection is that she got around nine or ten thousand dollars.

" * * *

"Q What was her advantage in this transaction?

"A She needed money.

"Q Your testimony is that she didn't have money available elsewhere?

"A Well, now, I know what the problems were. I feel that's a privileged area, and I wouldn't know what the problems were if I didn't. And it's one of the areas that she probably wouldn't want to divulge.

" * * *

"Q Now, assuming for whatever reason she didn't want to liquidate them, which obviously would be one way to get money, couldn't she have borrowed against those securities anywhere and limited her liability in the amount of the loan?

"A No. But I can't tell you why.

"Q She was free to pledge them to GECC?

"A It's her stock. She could have sold it.

"Q Right. And she could have used this collateral for a loan?

"A No. I don't think anybody wants to know why. She could have made it and somebody have it in the bank in a commercial institution; does that help? "

James McKie testified, without objection, before the Trial Board that the 17 acres were later sold by Merwin to American Guaranty for the sum of $800,000. However, everybody did not live happily thereafter. 7

On November 20, 1979, the Oregon State Bar filed a complaint in this court against Robeson. An amended complaint was filed on September 3, 1980. This matter was called to the attention of the Oregon State Bar by a letter from a securities examiner of the Corporation Commissioner's office.

The amended...

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14 cases
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    • Oregon Supreme Court
    • 3 Diciembre 1985
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2 books & journal articles
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    • Washington State Bar Association The Law of Lawyering in Washington (WSBA) Chapter 6 Confidentiality
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