DECLARATION UNDER PENALTY OF PERJURY

I, Douglas A. Schafer, declare under penalty of perjury under the laws of Washington that the following is true to the best of my knowledge and belief.

August, 1992. On August 12, 1992, I was called by my client, William L. Hamilton, who I previously had advised in several matters including the formation in 1990 of Sound Banking Company (of which he then was President/CEO, as he had been at Western Community Bank for about 25 years before its sale), and he requested that I form a new corporation for him immediately. He said that an attorney he knew, Grant Anderson, had been "milking" an estate for four years and was about to become a judge, so he needed to quickly sell the estate's business, Pacific Lanes, in order to close the estate before he took the bench. Hamilton said that he had agreed to buy the business. It was either in that phone conversation or when we met on August 17, 1992, that Hamilton commented that there was no time for an appraisal of the business, that Anderson was giving him a good deal, and that Hamilton would repay him "down the road" by paying him as corporate secretary or something like that. When I heard that comment, I told Hamilton, "I don't even want to hear about it!" I formed his corporation, Pacific Recreation Enterprises, Inc., and had no further involvement with him concerning the purchase of Pacific Lanes. My notes from those conversations and papers Hamilton gave me when me met reflect that the estate was that of Chuck Hoffman.

July, 1995. Though my office-bound legal practice of 17+ years has involved almost no appearances before judges, I got involved in a case for Don Barovic in July, 1995, which caused me to appear (for probably only the second time in my career) before a judge, who turned out to be Judge Grant L. Anderson. Since his rulings in that case, both before and after I became involved, caused me to doubt his competency as a judge, in late July I checked my Hamilton file for the name of the estate from which he had purchased the bowling lanes, then reviewed the Hoffman Estate court file at the clerk's office. I took notes, but did not follow up on anything.

December, 1995. After another hearing before Judge Anderson on December 15, 1996, I checked out the Hoffman Estate court file, copied it, and began calling attorneys named in it. I was particularly bothered that Anderson's $112,000 personal representative's fee request had been approved by Commissioner Johnson, without participation by any other attorney, just a few days before Anderson became one of the judges to whom that commissioner was accountable.

I felt that I needed to confront William Hamilton directly about his comment of almost 3½ years earlier, so I called him requesting a face-to-face meeting, and he agreed to meet me at the Pine Cone Restaurant the next Monday, December 18, 1995. When we met that morning, I expressly told him that I recalled his comment from August, 1992, about his intention to repay Anderson for the Pacific Lanes deal, that I and my client Barovic were now appearing before Judge Anderson, and that I needed to know if Anderson has "stellar" integrity.

We met for almost three hours, during most of which time Hamilton was telling me about major structural problems he had encountered with the Pacific Lanes building, for which he recently recovered his costs from the insurer. He responded to my specific query about whether Anderson has "stellar" integrity by saying that Anderson was as honest as most any lawyer (conveying by his tone his belief that most lawyers are not honest). He told me that Anderson has been a good friend of his for 20 to 25 years; that they socialized with their wives; that he had attended the wedding of one of Anderson's children; etc.

Hamilton told me that Anderson had campaigned not only for the superior court position he now holds, but had also campaigned for a supreme court position. Hamilton said that he had made "a five-figure contribution" to one of Anderson's election campaigns, but he could not recall which of those campaigns it had been.

Hamilton told me that Anderson has medical problems (I believe he said prostrate cancer, with ongoing chemotherapy), and that he and his wife, Diane, were getting a divorce. Hamilton said he had heard that Diane blamed him, for having gotten Anderson interested in Harley motorcycles, somewhat for the failure of her marriage with Grant.

During the meeting, I told Hamilton that I had reviewed the Hoffman Estate court file, and was quite bothered that Anderson's $112,000 personal representative's fee had been summarily approved without any apparent scrutiny by a commissioner who was about to become Anderson's subordinate. We discussed somewhat the Hoffman Estate. He indicated he thought Anderson had done admirable work in shifting some of the Surfside resort timeshare owners around so he could to sell whole units and liquidate that property. I informed him that I learned that Chuck Hoffman's ex-wife, Millie (the sole life beneficiary of his estate and testamentary trust), had died in late January, 1992. Hamilton told me that a few months after her death, the hospital (Pacific County Hosp. District was the remainder beneficiary of 90% of Hoffman's estate/trust) requested a payoff on the Pacific Lanes financing. Hamilton said he shopped for bank financing (I think he mentioned he rejected Key Bank's lending terms because he got better terms at First Interstate Bank), and negotiated with Steve Fisher (Anderson's former law partner who he nominated, and Commissioner Johnson appointed, as the successor trustee of the Hoffman Trust) for a significantly discounted payoff of the Pacific Lanes purchase. Hamilton said he was quite surprised when, after that payoff had closed, Steve Fisher billed him about $15,000 for legal services related to that negotiated payoff.

My meeting with Hamilton ended with him strongly urging me to stop "looking for dirt" on Anderson, and urging me to simply run against him in his next election if felt he was a poor judge. I responded that I would consider what he had told me, and that I was undecided whether to pursue the Hoffman Estate matter further.

That afternoon, I met briefly with S. Alan Weaver, of Eisenhower & Carlson, who had been retained by Anderson to prepare the estate tax return for the Hoffman Estate and who represents Key Trust Co. in my Barovic case. I inquired into his relationship with Judge Anderson (reportedly, a former law school classmate with whom he'd had little contact but for the Hoffman Estate), conveyed my concern about the circumstances surrounding the approval of Anderson's $112,000 PR's fee, and questioned whether Anderson had committed malpractice by drafting Hoffman's will to leave 90% to a hospital without qualifying for the charitable deduction, thereby causing unnecessary payment of $83,000 in estate taxes. Weaver essentially responded that he could tell me nothing, because Anderson was his client.

I believe it was Tuesday evening that I viewed and printed out (using the library's microfiche reader/printer) Judge Anderson's Public Disclosure Commission reports that I had requested the prior Friday. I noted suspiciously that Anderson first reported in his PDC Form F-1 dated 4/16/93 a category E (over $50,000) money market account at Sound Banking Company (Hamilton's bank); and that his F-1 dated 3/14/94 reported that same account as well as a category E investment in stock of Sound Banking Company. Because Hamilton had not mentioned those investments to me, and I was unsure I could trust him, I called William J. Rhodes (co-founder/director/officer of Sound Banking Company, formerly #2 executive at Western Community Bank). I explained that I had just met with Hamilton about concerns over his purchase of Pacific Lanes from Anderson, that I subsequently learned from PDC reports that Anderson become a Sound Bank shareholder after that deal, and I asked Rhodes to check and let me know when and from whom Anderson acquired his Sound Bank stock. Rhodes reported back to me that Anderson had been one of the 35 or so founding shareholders and that because of the buy-sell provisions (I had drafted but forgotten about) there had been no new shareholders since the bank's opening in 1990.

My report back from Rhodes was either Wednesday afternoon or Thursday morning. I was called by Hamilton at 1:05 p.m. on Thursday, and when I promptly returned his call he expressed anger at my having had Rhodes check into Anderson's stock ownership at Sound Bank, saying that now "Claudia and the girls are wondering what's going on." I expressed my disappointment that he had not apprised me of Anderson's relationship with the bank. Hamilton told me in quite stern terms that I should just "drop it"--my probing about Anderson.

January and February, 1996. By late January, I had gathered sufficient public documents concerning Anderson's handling of the Hoffman Estate that I was certain there had been wrongdoing by Anderson. In late January, more hearings in the Barovic cases were scheduled to be heard by Judge Anderson on February 2, 1996. I determined that I was not going to allow my client to be further judged by an individual whom I was convinced himself lacked personal integrity. Accordingly, I determined to let parties who were involved in the Hoffman Estate know that I was investigating it, so that Anderson would learn of it, so that he would honor my proposed request that he withdraw from further participation in my Barovic case.

Late afternoon on Wednesday, January 31, 1996, I called CPA Gary Find (who did the accounting work for the Hoffman Estate and its corporations), saying I was trying to locate appraiser Jim Latteri (who appraised Surfside and Pacific Lanes for estate tax purposes, and whom I have not yet located) and indicating I had seen his name in the Hoffman Estate files. He suggested I call Hamilton, "Who could answer any questions I might have about Pacific Lanes." At about 8:00 a.m., the next morning (Thursday), I dropped in on Frind and he met with me. I told him that I was investigating Anderson's handling of the Hoffman Estate, that Hamilton had told me in December that he had made a five-figure contribution to one of Anderson's election campaigns but that it was not reflected on any PDC report, that I was aware of Anderson deeding Surfside timeshares to everyone in his office three weeks before closing the estate and taking the bench, that I assumed considerable important information was contained in Frind's files that investigators would be needing and that he should safeguard those files. It was a dead serious, one-sided conversation--I talked, he listened and took notes, I left.

I then went to Judge Anderson's courtroom and confronted his judicial assistant, Ms. Sheri Fontana (who had worked for Anderson in his law firm before he became a judge). I showed her the Surfside timeshare deed to Sheri Van Sittert and inquired if that was her. She confirmed that Van Sittert was her married name. I asked if she had paid the market price for the timeshare, to which she responded "yes" and said that she was still making monthly payments on it. She asked why I was looking into her personal affairs, and I responded that I was looking into Anderson's handling of the Hoffman Estate.

Later that morning, I spoke with Diane Anderson's divorce attorney, Camden Hall. I informed him that I was investigating Anderson's handling of the Hoffman Estate and had found apparent misconduct involving the sale of Pacific Lanes to Hamilton and involving the Surfside resort.  He responded with, "I was wondering when that shoe was going to drop."  He told me not to disclose him as the source of the tip, but suggested that I check into Anderson's acquisition of his Cadillac, since Anderson had been evasive about his acquisition of it when information was requested in the divorce proceedings. [Bolded emphasis added by D. Schafer to this HTML copy of the Declaration.  It was not bolded in the original.  Mr. Hall is a partner at Foster Pepper & Shefelman, PLLC. Barrie Althoff, the State Bar's Chief Disciplinary Counsel worked at Foster Pepper & Shefelman for eleven years (about 1976-87), presumably as a colleague of Mr. Hall.  Mr. Hall has not been disciplined for disclosing the secrets of his client, who's been clearly embarrassed by the publicity surrounding her former husband's corruption.]

At 10:22 a.m., Hamilton faxed me a letter terminating any attorney-client relationship with him and with Sound Banking Company, and demanding that I not disclose any privileged information learned from him or the bank. I called him and suggested we promptly meet so I could show him the information implicating Anderson that I had obtained from public sources. I insisted that Hamilton have an attorney at that meeting, and he agreed to meet at or after lunch.

I called attorney Steve Fisher, but he was out. I called attorney Dave Tuell (Anderson's former law partner), disclosing to him my investigation (including asking him about the timeshare deeds to him and others in the office, and telling him of Hamilton's stated but unreported five-figure campaign contribution to Anderson), but he acted shocked and declined to host the meeting with Hamilton. Hamilton called back, saying that his attorney Phil Sloan agreed to represent him and to meet with he and I at 1:00 p.m. At that meeting in Sloan's office, Hamilton initially stated emphatically that he had not made any five-figure campaign contribution to Anderson. I immediately inquired if he had made any substantial gifts to Anderson, and upon Sloan's direction, Hamilton refused to answer. During the meeting, I asked that question several times, with the same response each time. I informed them at the meeting about the timeshare deeds. They repeatedly stressed to me that they believed I was barred by ethical rules from disclosing anything to anyone about the Hoffman Estate because my investigation had been prompted by Hamilton's 1992 comment. They threatened to sue me if I did so.

That afternoon I prepared and the next morning I presented to Judge Anderson, a Motion of Prejudice stating that I had reason to believe that Judge Anderson was aware I was investigating his handling of the Hoffman Estate, and that I believed an investigation into it might result in his removal from the bench. He then recused himself from any further involvement in the cases of my client, Don Barovic.

Prepared and signed on February 16, 1996, at Tacoma, Washington.
 
 

Douglas A. Schafer