The Indiana Lawyer on 6/4/2019 by Olivia Covington
Hendricks Superior Judge Robert W. Freese has been suspended from judicial office without pay for 45 days after appointing a friend as a trustee of an estate case he was presiding over and failing to take action when the friend did not fulfill his duties, resulting in a “massive theft.”
Freese’s judicial suspension will take effect at 12:01 a.m. July 8 and will expire at the same time on Aug. 22, according to the disciplinary opinion handed down Tuesday in In the Matter of the Honorable Robert W. Freese, Judge of the Hendricks Superior Court 1, 19S-JD-52.
The Indiana Supreme Court Commission on Judicial Qualifications filed disciplinary charges stemming from two counts of misconduct against Freese in January. The judicial discipline stems from Freese’s longtime friendship with Stephen Scott, “one of his closest friends,” according to the suspension order. Their relationship was such that in 2004, Freese used his line of credit to help Scott buy a home, and together the men executed and recorded a $122,400 mortgage in 2005.
Seventeen days after the mortgage was executed, Freese appointed Scott as trustee over the Herbert Hochreiter Living Trust in one of Freese’s cases, Trust of Herbert Hochreiter, 32D01-9710-TR-000003. The parties did not object to Scott’s appointment, but Freese did not disclose their financial arrangement.
Then when Hochreiter died later in 2005, Freese appointed Scott as personal representative of the $2.3 million estate, again failing to disclose the financial arrangement.
Throughout his time as trustee and personal representative, Scott regularly failed to provide the required accounting. When Scott did file a partial, defective accounting in 2009, Freese granted him an extension over the objection of one of the beneficiaries, who believed gold bars were missing from the trust.
Then in 2010, Scott moved to withdraw as trustee, but the beneficiaries objected to him doing so without filing a completing accounting and tax returns. Scott, however, relocated to Florida and never responded to the objection.
Scott’s counsel then began serving as successor trustee and personal representative, and for roughly the next two years, the former trustee was unresponsive to summonses. Further, the successor trustee reported that the trust checking account had only $8.27 and the savings account had been closed for more than six months. In contrast, Scott’s attorney believed the trust should have held $50,000 to $60,000 in cash.
“Judge Freese ‘took no action or minimal action’ on those reports,” the Supreme Court wrote in the Tuesday per curiam opinion. “But while the cases were pending and Scott was living in Florida, he left Scott a phone message stating he was concerned that Scott was behaving bizarrely, and that he ‘would never have thought [Scott] would have stolen anything.’”
Freese eventually ordered Scott to appear in person for a show cause hearing in the fall of 2012, but Scott again failed to show up. Thus, Freese entered a nearly $580,000 judgment against his friend, finding $140,550 was disbursed from the trust to Scott’s personal accounts between September 2007 and August 2011, on top of $101,217 in illegitimate wire transfers or cash withdrawals during that time. Additionally, Freese found $16,800 was transferred from the estate to Scott in January 2010, and the remaining bank balance of $6,517.08 was taken by an unexplained cash withdrawal.
Freese did not refer his findings to local prosecutors or the U.S. attorney, the court wrote, but Scott pleaded guilty in 2017 to federal embezzlement charges. Indiana Southern District Court Judge Tanya Walton Pratt sentenced Scott to 30 months in prison in May 2017.
The stolen funds have not been recovered.
The parties cited no aggravators against Freese, but listed several mitigators, including his “lengthy and distinguished judicial career” and lack of prior discipline. Freese, the former president of the Indiana Judges Association, was also credited for his “active leadership in judicial, legal, and civil-service organizations.”
“They also agree his misconduct was not deliberate or willful and brought him no financial benefit or personal gain, and that the Judge relied heavily on the attorneys to file pleadings in the Trust because it was unsupervised,” the court wrote. “But the Judge also acknowledges that I.C. section 30-4-5-13(b) allowed him to act on his own motion, and that in retrospect he should have acted sooner given the information available to him.”
In agreeing to the parties’ recommendation of a 45-day sentence, the justices said such a sanction is “very severe.” Even so, “the Judge’s misconduct ultimately enabled a massive theft.”
“’The purpose of judicial discipline is not primarily to punish a judge, but rather to preserve the integrity of an public confidence in the judicial system and, when necessary, safeguard the bench and public from those who are unfit,’” the court wrote, citing In re Hawkins, 902 N.E.2d at 244 (Ind. 2009). “The sanction must be designed to deter similar misconduct and assure the public that judicial misconduct will not be condone.
“…(A) 45-day suspension from office without pay is a very serious sanction, but we agree it is warranted here, in view of the serious harm to the Trust and Estate that were enabled by the Judge’s misconduct.”
The commission on judicial qualifications alleged violations of Code of Judicial Conduct Rules 1.2, 2.13(A)(1), 2.4(B) and 2.5(A). Freese stipulated to those violations. The costs of the proceedings, $1,460, are assessed against Freese. All justices concur.