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Stephen K. Eugster (WSBA No. 2003, admitted 1970), of Spokane, was suspended for 18 months, effective June 11, 2009, by order of the Washington State Supreme Court following an appeal. For further information, see In re Disciplinary Proceeding Against Eugster, 209 P.3d 435 (2009).This discipline is based on conduct involving failure to abide by a client’s objectives, disclosing confidential information, using information related to representation to the client’s disadvantage, failure to surrender a client’s file, failure to protect a client’s interests, disobeying an obligation under the rules of a tribunal, and conduct prejudicial to the administration of justice.
Mrs. S, an 87-year-old widow, hired Mr. Eugster in June 2004. Mrs. S had recently moved into an assisted-living facility after the death of her husband. Mr. Eugster had previously represented her only son (RS) in the early 1990s in a dissolution matter. The objective of Mrs. S in contacting Mr. Eugster was to remove RS from his position of control over her affairs and to assist her with estate planning. In 2003, before her husband’s death, Mrs. S and her husband had executed new wills drafted by another attorney. Under those wills, RS would inherit the home of Mr. and Mrs. S, and the daughter of RS would be the beneficiary of a residual trust. The wills also created a supplemental-needs trust for the surviving spouse and named RS as the trustee, with the discretion to make or withhold payments. The wills specified the trust was irrevocable and could not, absent a court order, be changed.
In late 2003, dissatisfied with the wills, Mrs. S contacted Attorney B, who changed the beneficiary of a life-insurance policy from RS back to Mrs. S. RS discovered that Mrs. S had hired Attorney B and became “very upset.” He saw his mother’s consultations as a betrayal of family trust and questioned her competence. In January 2004, RS had a psychologist examine his mother for testamentary capacity. The psychologist concluded that Mrs. S had testamentary capacity.
In February 2004, upon the death of Mr. S, RS became the personal representative of his estate and acted as trustee of the supplemental-needs trust for the benefit of Mrs. S. RS also assumed control over the payment of bills, because he did not believe his mother was capable of doing so. During this time, the relationship between RS and his mother continued to deteriorate. Mrs. S felt RS was manipulating her estate and denying her adequate funds so he could preserve more for himself and his daughter after her death. The relationship became even more strained as RS continued to refuse her requests for money. Mrs. S hoped removing her son from authority over her affairs would help mend their relationship. Mrs. S hired Mr. Eugster in June 2004 to “short-circuit” RS’s control over her affairs and also to retrieve certain items of personal property from RS. Mr. Eugster had Mrs. S revise her estate-planning scheme by creating a revocable living trust. Mrs. S was named the trustee, with Mr. Eugster serving as successor trustee and RS as secondary successor trustee. To protect Mrs. S, consistent with the existing testamentary trust and consistent with her desire that RS not control her finances, Mr. Eugster was given power of attorney both generally and for health care.
In July 2004, Mr. Eugster met with RS to discuss the supplemental-needs trust created by Mr. S’s will. He also consulted with Mrs. S’s financial planner and made preparations to sell the family home of Mr. and Mrs. S. As to recovering Mrs. S’s personal property, Mr. Eugster located the items she requested but assured her by letter that RS was keeping them safe. In August, Mr. Eugster wrote Mrs. S to assure her of RS’s good intentions toward her and recommended RS resume control over her affairs. Mrs. S responded by seeking counsel of another attorney (Attorney C). On September 9, 2004, Attorney C wrote Mr. Eugster notifying him that Attorney C now represented Mrs. S and explicitly revoking Mr. Eugster’s power of attorney. Mr. Eugster responded by letter stating that he did not “believe that [Mrs. S] is competent. A guardianship should be established for her person and her estate….”
Attorney C then sent a letter to Mr. Eugster that his services as Mrs. S’s attorney were terminated and requesting that her files be forwarded to his office. In addition, the letter stated that Mrs. S “fully expects any and all communications with you to remain confidential and not be passed on to [RS].” Attorney C also asked Mr. Eugster to advise him of any changes in Mrs. S’s competence since the execution of her trust in July where witnesses testified she was of sound mind.
Around the same time, Mrs. S removed Mr. Eugster as her successor trustee of her trust and named a new successor trustee (NTM Services). Under the durable power of attorney prepared by Attorney C, NTM Services was entitled to reimbursement for all costs and expenses and “shall be entitled to receive at least annually, without court approval, reasonable compensation for services performed on the principal’s behalf.” On October 8, 2004, NTM Services informed RS that Mrs. S had resigned as trustee and had named NTM Services as successor. Attorney C and NTM Services also attempted to get RS, as trustee of Mr. S’s testamentary trust, to pay $2,000 per month to them for “one-half of her support.” Mr. Eugster deemed the requested payment improper under the special-needs trust.
On September 27, 2004, Mr. Eugster petitioned the court to appoint a guardian for Mrs. S. He filed the guardianship action pursuant to former RPC 1.13, “Client Under a Disability.” Mr. Eugster signed his name on the line marked “Petitioner/Attorney” and represented that he was the current attorney for Mrs. S. RS served as the co-petitioner at the behest of Mr. Eugster, and provided some of the information for the petition. Mr. Eugster disclosed to RS his belief that Mrs. S lacked competence. RS eventually hired an attorney to represent him in the guardianship proceeding. The petition listed Mrs. S’s personal and financial information, characterized her as unable to manage her person and estate, and described her as “delusional.” In the petition, RS was nominated to act as Mrs. S’s guardian. The petition for appointment of guardian was served on Mrs. S in the common room of her assisted-living facility, which humiliated her. Mr. Eugster filed the petition based upon his personal judgment without conducting any formal investigation into the medical or psychological state of Mrs. S. Three months before he filed the guardianship petition, Mr. Eugster had Mrs. S sign a new trust, powers of attorney, and a will that he had prepared, indicating he had no concerns about her testamentary capacity at that point. The last date that either Mr. Eugster or RS personally talked to Mrs. S was two months before filing the petition.
Mr. Eugster appeared before a judge seeking appointment of a guardian on October 19, 2004. He assured the court that he had reviewed the ethical issues involved with him seeking to appoint a guardian. Mr. Eugster told the court he believed his actions were ethically viable, and the court asked Mr. Eugster to brief the issue. Mr. Eugster did not supply a brief. Instead, by letter dated October 21, 2004, Mr. Eugster purported to decline his service as successor trustee over Mrs. S’s trust and as attorney-in-fact. On October 26, 2004, the guardian ad litem (GAL) appointed to evaluate Mrs. S concluded she was not suffering from any incapacity and was capable of handling her own affairs. He noted Mrs. S’s strained relationship with and distrust of her son, RS. The GAL concluded Mrs. S did not need a guardian, but that if the court did appoint one, the guardian should not be RS. On November 17, 2004, Mr. Eugster withdrew his signature from the guardianship petition. By stipulation of the parties, the court dismissed the guardianship petition on February 1, 2005. Mrs. S paid $13,500 to defend herself in the guardianship action.
Mr. Eugster’s actions violated former RPC 1.2(a), requiring a lawyer to abide by a client’s decisions concerning the objectives of representation; former RPC 1.6(a), prohibiting a lawyer from revealing confidences or secrets relating to representation of a client unless the client consents after consultation; former RPC 1.8(b) and former RPC 1.9(b), prohibiting a lawyer who is representing a client from using information, confidences, or secrets relating to the representation of a client to the disadvantage of the client unless the client consents after consultation; former 1.9(a), prohibiting a lawyer who has formerly represented a client in a matter from representing another person in the same or a substantially related matter in which that person’s interests are materially adverse to the interests of the former client unless the former client consents in writing after consultation and a full disclosure of the material facts; former RPC 1.15(d), requiring a lawyer to take steps to the extent reasonably practicable to protect a client’s interests, such as surrendering papers and property to which the client is entitled; former 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 former 8.4(d), prohibiting a lawyer from engaging in conduct that is prejudicial to the administration of justice.
Jonathan Burke represented the Bar Association. Shawn T. Newman and Kris J. Sundberg represented Mr. Eugster. Jane B. Risley was the hearing officer. |