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John C. Beckwith (WSBA No. 8083, admitted 1978), of Seattle, has been disbarred by order of the Supreme Court effective January 22, 2001, following a default hearing. The discipline is based upon his use of client funds to make personal investments in 1998.
In 1986, Mr. Beckwith drafted a client’s will. The will established a testamentary trust. The will also provided a $1,000 testamentary gift to Mr. Beckwith’s wife and $500 to his daughter. The client died in September 1986. Following probate, Mr. Beckwith transferred the estate’s $387,000 in assets into the trust. In May 1988, the trustee became ill and Mr. Beckwith was appointed successor trustee. On January 6, 1990, the client’s last living sibling died. The trust directed that the trustee should distribute the remaining assets to charities he believed the client would favor.
In March 1998, a firm bookkeeper discovered a February 1998 bank statement for the client’s trust account. The statement included cancelled checks for Mr. Beckwith’s personal dry cleaning, shopping, grocery, utility and credit-card expenses. Upon this discovery Mr. Beckwith’s partner suggested that he self-report to the Bar Association. Mr. Beckwith contacted the Bar Association on March 26, 1998 and asked about resigning. He told the licensing supervisor that he was thinking of leaving the country.
On March 27, 1998, Mr. Beckwith signed the resignation form at the Bar Association office; however, the Bar Association’s general counsel did not accept the resignation. On March 31, the Office of Disciplinary Counsel subpoenaed Mr. Beckwith to appear, provide testimony, and produce records regarding this client’s estate. On April 6, Mr. Beckwith wrote a letter to disciplinary counsel stating that he no longer considered himself subject to Bar Association jurisdiction and that he was invoking his Fifth Amendment right against self-incrimination in declining to comply with the subpoena. Mr. Beckwith did not attend the deposition.
In May 1998, the attorney general’s office received a preliminary injunction prohibiting any transfers or disposition of any trust assets and appointing a special master. Mr. Beckwith refused to cooperate with the investigation. The special master found that Mr. Beckwith used the trust funds to make high-risk investments and commingled his personal funds with the trust funds. The special master also found that on December 1, 1989, Mr. Beckwith, as trustee of the trust, loaned $20,000 in trust funds to developers of a condominium project on Bainbridge Island. The loan was secured by the undeveloped real property and memorialized by a note and profit-sharing agreement.
In late 1992, Mr. Beckwith and a friend purchased the note and profit-sharing agreement for $20,000. On January 21, 1993, Mr. Beckwith assigned the note to himself personally and to his friend. Mr. Beckwith and his friend then exchanged their note for an interest in a real-estate development partnership. They may have added an additional $10,000 of their own funds to this investment. On January 22, 1999, the court appointed a receiver for the trust funds. In March 2000, Mr. Beckwith and his friend each received $84,668 from the real-estate investment. The profit was not returned to the trust.
Mr. Beckwith’s conduct violated RPCs 8.4(b), prohibiting committing a criminal act that reflects adversely on the lawyer’s honesty, trustworthiness or fitness as a lawyer in other respects; 8.4(c), prohibiting engaging in conduct prejudicial to the administration of justice; 1.8(c), prohibiting preparing an instrument giving the lawyer or a person related to the lawyer as parent, child, sibling or spouse any substantial gift from a client, including a testamentary gift, except where the client is related to the donee; and RLD 2.8, requiring lawyers to cooperate with discipline investigations.
Kevin Bank represented the Bar Association. Mr. Beckwith represented himself. The hearing officer was Jack Cullen.
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