Case Title: IN RE HON WILLIAM RUNCO

Citation: 

Docket Number: 116565

State: michigan

Court: Michigan Supreme Court

Date: 2001-01-17T00:00:00Z

Document:
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Michigan Supreme Court 
Lansing, Michigan 48909 
C hief Justice 
Justices 
Maura D. Corrigan  
Michael F. Cavanagh 
Elizabeth A. Weaver 
Marilyn Kelly 
Clifford W. Taylor 
Robert P. Young, Jr. 
Opinion 
Stephen J. Markman 
FILED JANUARY 17, 2001  
In re HONORABLE WILLIAM J. RUNCO,  
No. 116565  
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 we 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 Ilene Trifan were the owners of a  
bowling alley in Melvindale, Michigan, which they 
had acquired for $60,000 in 1984.  Respondent Runco  
1 As its findings of fact, the commission adopted the 
facts found by the master.  Thus, the quoted material was 
authored by the master.  
 
 
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.  
Respondent 
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  
2  
 
 
 
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 Trudeau 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.  
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  
3  
 
 
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 better 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. Almost immediately thereafter, under 
Respondent’s version, he became involved in a 
business relationship with his handpicked purchaser 
and acquired an interest in the property, which 
translated very quickly into a substantial profit. 
Given Respondent’s role in the initial transaction, 
and 
the 
proximity 
in 
time 
between 
his  
representation of the Trifans and his business  
4  
arrangement involving the property, accepting his 
version of the sequence of events, he should have 
been put on notice that his actions constituted 
self-dealing or the appearance of self-dealing and 
monetary benefit at the expense of his clients.  
The commission also found that Judge Runco committed  
judicial misconduct by failing to file a timely answer to the  
formal complaint:  
Respondent failed to file an answer to the 
Formal Complaint containing a full and fair  
disclosure 
of 
all 
facts 
and 
circumstances  
pertaining to the alleged misconduct, as required 
by MCR 9.209(A), and failed to comply with a 
Commission Order requiring that he “file and serve 
his answer to the Formal Complaint on or before the 
close of business on January 8, 1999,” despite a 
warning from the Master that he would be in default 
if he failed to comply.[2]  
Throughout the pendency of this matter, the parties have  
disputed whether this matter should be dismissed on the basis  
of laches, or some similar theory.3  On this record, we are  
2 The formal complaint was filed on November 23, 1998. 
In response, Judge Runco filed on December 7, 1998, a document 
entitled “Answer to Complaint,” but which specifically stated 
that “Respondent is not at this time filing an Answer to the 
Formal Complaint as contemplated by MCR 9.209.”  Instead, 
Judge Runco filed a complaint for mandamus under MCR 7.304(A), 
seeking to have this Court exercise superintending control 
over the Judicial Tenure Commission and dismiss the formal  
complaint in part on the basis of laches. As the commission  
noted in its opinion, Judge Runco also ignored a December 15, 
1998, order directing him to file an answer.  
Even assuming without deciding that the filing of the 
complaint 
for 
mandamus tolled the fourteen-day period in which 
Judge Runco’s answer was due under MCR 9.209(A), Judge Runco 
still did not file an answer until July 26, 1999, more than 
two months after this Court dismissed his complaint and lifted 
the stay of proceedings that had been entered.  
3 
 
In 
response 
to 
Judge 
Runco’s 
complaint 
for  
superintending control, we directed the parties in March 1999 
to brief “the questions whether (a) a formal complaint may be 
defended on a ground in the nature of a statute of  
5  
satisfied that, even if such a defense were available in this  
case (a question we do not decide), there would be no basis  
for its application here.  As the commission observed, the  
heart of this dispute concerns the timing of the agreement  
between Judge Runco and Mr. Trudeau. 
Each testified at  
length, and we accept the commission's determination that the  
materials that had become unavailable over time did not  
include any that were necessary for resolution of the central  
issues.  
The commission found that a public censure was an  
appropriate sanction in this case:4  
In considering what sanction to recommend to  
the Supreme Court, the Commission notes that  
Respondent committed the acts underlying Formal 
Complaint No. 61 over 12 years ago, when he was a 
fairly young, inexperienced attorney, and the book 
has yet to be closed as Respondent's former client 
has a pending civil action for money damages. 
Furthermore, there is no record of any disciplinary  
limitations, (b) whether such a defense, if accepted, should 
be developed as a court rule, or as an application of laches 
or due process, or in some other manner, (c) whether such a 
defense, if accepted, should include a tolling or discovery 
provision, and (d) how such a defense, if accepted, pertains 
to the present case.”  590 NW2d 288 (1999).  After hearing 
oral argument, we entered an order that provided:  
Counsel for the Judicial Tenure Commission  
having 
represented 
at 
oral 
argument 
that, 
consistent with MCR 9.205(E), the commission must 
consider all circumstances, including equitable 
defenses, in deciding whether to take action, and 
further that the master is authorized to recommend  
dismissal at any time during the proceedings, the 
complaint for superintending control is dismissed. 
[459 Mich 1251 (1999).]  
4 
 Three members of the commission dissented in part, 
urging this Court to impose a thirty-day suspension without 
pay.  
6  
 
 
 
action against Respondent as a judge, a position he 
held for eight years prior to this proceeding.  
We agree with the commission’s finding that Judge Runco  
committed misconduct in violation of Const 1963, art 6, § 30,  
and MCR 9.205(E) by engaging in self-dealing contrary to the  
interests of his clients, and that Judge Runco’s failure to  
file a timely answer to the formal complaint constitutes  
additional grounds for discipline.  MCR 9.209(A).  We further  
agree that a public censure is warranted.  Accordingly, for  
these reasons, we publicly censure the Honorable William J.  
Runco, Judge of the 19th District Court.  This written  
judgment will stand as our censure.  
CORRIGAN, C.J., and WEAVER, 
KELLY, TAYLOR, 
YOUNG, 
and MARKMAN,  
JJ., concurred.  
7  
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S T A T E O F M I C H I G A N  
SUPREME COURT  
IN re HONORABLE WILLIAM J. RUNCO,  
No. 116565  
CAVANAGH, J. (concurring in part and dissenting in part).  
I concur with the findings of fact and conclusions of law  
in the per curiam opinion, but dissent from the sanction  
imposed.  I would impose the sanction recommended by the  
dissenting opinion of the Judicial Tenure Commission, a  
thirty-day suspension without pay.