In Re Runco

620 N.W.2d 844, 463 Mich. 517
CourtMichigan Supreme Court
DecidedJanuary 17, 2001
DocketDocket 116565
StatusPublished
Cited by7 cases

This text of 620 N.W.2d 844 (In Re Runco) is published on Counsel Stack Legal Research, covering Michigan Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In Re Runco, 620 N.W.2d 844, 463 Mich. 517 (Mich. 2001).

Opinions

Per Curiam.

The Judicial Tenure Commission has asked this Court to enter a public censure of 19th (Dearborn) District Judge William J. Runco. We accept the recommendation of the commission, and [518]*518we enter this opinion, which will stand as our censure.

i

Our review of this matter is de novo. In re Ferrara, 458 Mich 350, 358; 582 NW2d 817 (1998). Having examined the record and considered the arguments of the parties, we adopt the following facts, as found by the commission:1

Gerald and Hene Trifan were the owners of a bowling alley in Melvindale, Michigan, which they had acquired for $60,000 in 1984. Respondent Runco did the legal work for the Trifans in the purchase of the property. The building became damaged and condemned by the City of Melvindale in 1986. The Trifans could not afford to remove it, therefore, the City removed it and filed a lien against the property for the cost of the removal. As of November 1986, the liens against the property were approximately $36,000.
The Trifans were interested in purchasing a bowling alley in Allen Park, Michigan, since their building had been destroyed, and were negotiating for its purchase in 1986. Mr. Trifan engaged Respondent Runco regarding this purchase. The Trifans had limited resources as a result of the closing of the Melvindale bowling alley, their sole source of income at that time, and needed money from the sale of that property in order to purchase the Allen Park bowling alley.
The Trifans had listed the Melvindale property for sale with a multiple listing service for $49,000. Little Caesar’s restaurant chain made a written offer of $49,500, $500 more than the listing agreement price. Mr. Trifan brought this offer to Respondent Runco and asked him to review the terms of the purchase.
[519]*519Respondent Runco advised Mr. Trifan of contingencies in the Little Caesar’s offer. He suggested that there were so many contingencies that the purchaser would be able to back out without completing the sale. He then told Mr. Trifan that he had a friend, Raymond Trudeau, who had developed various properties in the area, and that he might be interested in the Melvindale property. Respondent Runco was aware that Trudeau had developed a Meineke Muffler Shop on similar property that he owned in Lincoln Park. Respondent Runco obtained Mr. Trifan’s permission to discuss the property with Trudeau. The property now consisted of seven vacant lots. Respondent Runco did not suggest or recommend that the Trifans either make a counteroffer to Little Caesar’s or negotiate to remove some of the unacceptable contingencies. Instead, he brought the property to Mr. Trudeau’s attention.
In the first conversations with Trudeau, Respondent Runco indicated that he would like to be part of the developments Trudeau was working on. He indicated his interest in becoming a partner in the development of the Trifan’s Melvindale property. During the course of these conversations and before the purchase of the Trifan’s property, it was agreed between Trudeau and Respondent Runco that they would work together on the Trifan property, with Trudeau doing all of the developing and investing all of the money and Respondent Runco doing all of the legal work in the development and sale of the property. Trudeau agreed that they would share the profits equally. Respondent Runco admitted there was an agreement, but claimed it was entered into after the sale of the Trifan’s property on March 31, 1987. Even the disclosure of Respondent’s interest in the sale after March 31, 1987, however, would give the appearance of impropriety.
. . . Mr. Trudeau testified more credibly in this regard. Unlike Respondent Runco, Mr. Trudeau had no apparent motive to provide false testimony. Memoranda was [sic] presented which indicated payments to Respondent Runco as a “finders fee.” The Trifans received no information about this informal partnership before or after the sale. Respondent Runco, on several occasions, indicated to Tru[520]*520deau that his financial interest in this property should not be disclosed to anyone. As a result, Trudeau did not disclose this to anyone except his wife, who was a partner in their development partnership known as VI Properties, and Joe Guido, a business associate. Trudeau and Respondent Runco obtained the zoning variance to permit the construction of an oil lube and muffler business on the Melvindale property before the purchase of the property.
[Jan
Trudeau, on behalf of the Trudeau/Runco partnership, made an offer of $46,000, which was accepted by the Trifans and the deal was closed on March 31, 1987, the same day that the Trifans closed on the purchase of the Allen Park property. The deal was closed in Respondent Runco’s office.
In November of 1987, Trudeau was “flabbergasted” when he received an offer for $133,000 for four of the seven lots as a site to build a Jiffy Lube. After negotiation, the property was sold for that amount. The transaction closed on January 19, 1988, and Trudeau and Respondent Runco shared the profits equally. Shortly thereafter, the remaining three lots were sold for $20,000. The two partners, again, shared the profits equally Respondent Runco admitted on the witness stand that he received a total on the two sales of $41,000 and deposited those sums in his brokerage account. At no time did Respondent Runco or Trudeau ever advise the Trifans of the secret partnership between them.
Respondent Runco’s attorneys tried to introduce many irrelevant facts regarding Mrs. Runco’s campaign for a State Senate seat. During this campaign, certain Dearborn businessmen had circulated derogatory statements about Mrs. Runco. Trudeau was never found to have participated in nor been responsible for any activity in this regard. This testimony, therefore, did not impeach Trudeau’s credibility.

Near the end of its recommendation, the commission offered a concluding paragraph that well summarizes the misconduct involved in this case:

The Commission would further state that the Master, who heard the testimony and observed the witnesses, was in a [521]*521better position to determine the credibility of the witnesses and that he rejected Respondent’s version of the facts. However, even if Respondent’s version of the facts were accepted as true, Respondent would still be guilty of professional misconduct. Respondent’s actions, as an attorney, created a breach of his fiduciary duty to his clients, the Trifans. Further, Respondent’s actions constituted a conflict of interest, or at least the appearance of same relative to his clients, the Trifans. This is not a situation where Respondent acquired information about his clients’ property independently, after the fact, and subsequently acquired an interest in it pursuant to some business arrangement with an unrelated third party. Instead, Respondent acquired information from his clients while he was representing them; he introduced the purchaser to his clients and essentially brokered the deal. Without Respondent’s involvement, there is no likelihood whatsoever that this transaction would have been consummated.

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Bluebook (online)
620 N.W.2d 844, 463 Mich. 517, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-runco-mich-2001.