Bozeman, MT 59715-3538
28 September 2007 | Active (17 years, 8 months ago) |
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28 September 2006 | Not eligible to practice law in CA (18 years, 8 months ago) Actual Suspension Delayed 98-O-00368 |
29 June 2006 | Probation with conditions 98-O-00368 (18 years, 11 months ago) |
18 August 1992 | Active (32 years, 10 months ago) |
10 July 1992 | Not eligible to practice law in CA (32 years, 11 months ago) Discipline w/actual suspension 90-O-13778 |
16 August 1991 | Disciplinary charges filed in State Bar Court 90-O-13778 (33 years, 10 months ago) |
19 June 1968 | Admitted to the State Bar of California (57 years ago) |
June 29, 2006 THOMAS FARADAY CAMP [#42007], 67, of Lafayette was suspended for two years, stayed, placed on two years of probation and was ordered to take the MPRE and comply with rule 955. The order took effect June 29, 2006. Camp stipulated to three counts of misconduct in handling two real estate deals for a client.The client and his brother had inherited several properties from their parents and the client’s share was $850,000. He faced a four-year prison term, wanted to defer paying income tax on the proceeds and therefore wanted to invest in similar properties by way of a tax-deferred (“Starkerâ€) exchange.Camp urged the client to invest in a Stockton shopping center that he said would generate monthly income of about $5,000. The client agreed to buy a 70 percent interest in the shopping center for $745,000. Camp did not tell him that $158,000 of that money would be for a syndicator’s fee or that the shopping center would be subject to possible cash calls.Although the syndicator’s fee appeared on escrow documents and on another document, the client never asked about it.A year after the client’s incarceration, the shopping center managers made a $100,000 cash call. Camp arranged for a $125,000 loan for the client, secured by three properties owned by the client. The three properties eventually went into foreclosure because the client, who was unemployed, couldn’t make the monthly payments. The shopping center ultimately went into foreclosure as well. It never generated $5,000 a month and the client lost his entire investment.At Camp’s recommendation, the same client invested the rest of the money he’d inherited — $96,000 — in a 40-acre unimproved parcel of land in Newman. Camp and another client had previously bought the property for $123,000; Camp contributed $29,000 cash and assumed an existing $45,000 loan and a second mortgage of $57,000. At the end of the transaction, there were $102,000 worth of loans against the property.A number of homes had been built at an adjacent subdivision, and Camp told his client that the development would be “coming right through†the Newman parcel. He did not tell him that the subdivision was in the city of Newman and the 40 acres were not, nor did he tell him about the liens against the parcel or about the risks associated with the investment.When the client invested the full $96,000, Camp repaid himself his $29,000 investment and kept the remainder; none of the money went to pay down the lien. The client was not aware that Camp and another individual had bought the property two weeks earlier and was not aware of the terms of the purchase. The client owned a 20 percent interest in the property, Camp owned 32 percent and the third person owned 48 percent.Camp stipulated that the transaction was not fair to the client: the client paid $96,000 for a 20 percent interest, when the total cost was only $123,000, and Camp and the other owner kept that money for themselves.Camp made the loan payments on the property for five years but eventually could not keep up. The owners’ interest in the property was transferred to West Side Transfer Service Inc., an entity owned by Camp, to facilitate a bankruptcy proceeding. Several parcels were sold off but the client received nothing. The remaining 17 acres eventually were transferred by West Side back to Camp, titled as his sole and separate property. He grant deeded 47 percent of the property — eight acres — back to the client.The client sued Camp for fraud, negligence and legal malpractice. A jury found that Camp defrauded the client in both property transactions and awarded him more than $1.5 million. In addition, the judge ordered Camp to deed his interest in the Newman property to his client. At the time, it had a value of be-tween $405,000 and $540,000. Com-bined with the client’s eight acres, his property is now worth between $765,000 and $1.2 million.Camp stipulated that he breached his fiduciary duties to his client, committed an act of moral turpitude and acquired an interest adverse to his client.He was disciplined in 1992 for failing to perform legal services competently or communicate with a client. In mitigation, he cooperated with the bar’s investigation. |