author: EASTAUGH, Justice. CARPENETI, Justice,

text:
    STATE of Alaska, DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT, DIVISION OF INSURANCE, Appellant, v. Robert E. SCHNELL, Appellee.
    No. S-8313.
    Supreme Court of Alaska.
    Sept. 22, 2000.

      Signe P. Andersen, Assistant Attorney General, Anchorage, and Bruce M. Botelho, Attorney General, Juneau, for Appellant.
    Joe P. Josephson, Josephson & Associates, Anchorage, for Appellee.
    Before MATTHEWS, Chief Justice, EASTAUGH, FABE, BRYNER, and CARPENETI, Justices.
   OPINION

EASTAUGH, Justice.

I. INTRODUCTION

The superior court equitably estopped the Alaska Division of Insurance from suspending and conditioning Robert Schnell's individual insurance producer's license. Because we hold that neither equitable estoppel nor laches barred the division from acting in 1995, we reverse the superior court's ruling. But because the division's director did not consider current evidence that was highly relevant to the sanctions issue, we remand with directions that the division reconsider its sanctions decision after conducting further proceedings.

II, FACTS AND PROCEEDINGS

Robert Schnell petitioned for personal Chapter 7 bankruptey in Alaska after suffering financial problems in the mid-1980s. He filed a schedule of assets and liabilities in his bankruptey proceeding in January 1987. As the bankruptcy progressed it became evident that Schnell had concealed assets. In November 1987 Schnell admitted in bankruptcy court that he owned valuable assets which he had not listed on his schedule of assets.

Soon after admitting his misrepresentation, Schnell applied to New York Life Insurance Company for employment as an insurance agent. New York Life and Schnell entered into an "Agent's Contract" effective March 2, 1988. New York Life has employed Schnell as an insurance agent ever since.

In June 1988 Schnell, who then worked in Arizona for New York Life, applied to the Alaska Division of Insurance for a nonresident individual insurance agent license. The division issued him that license later that month. Not long after, Schnell returned to Alaska and worked in New York Life's Anchorage office. He applied for a resident license in November 1988. The division also issued Schnell that license.

In December 1991 a federal grand jury indictment charged Schnell with false declaration, fraudulent concealment of assets, and perjury for his 1986 and 1987 conduct during his bankruptey. Schnell pled guilty to one count of false declaration, a felony; he was sentenced in June 1992. The government's sentencing memorandum asserted that there had been "on-going fraud which resulted in the concealment of approximately $200,000 worth of property."

Soon after Schnell's conviction, David Walsh, the director of the Alaska Division of Insurance, issued a statement of accusation against Schnell, and sought to revoke Schnell's insurance agent license. Walsh alleged that two grounds existed for revocation: the felony conviction itself, and the "acts giving rise" to the conviction, which "reflect[ed] untrustworthiness."

Hearing Officer Frank Flavin conducted a hearing on the accusation in November 1992 and issued a proposed decision in late December 1992. He recommended that Walsh (1) suspend Schnell's license for six months; (2) place Schnell on five years' license probation following the suspension; (8) require Schnell to give the division a semi-annual independent audit of his client accounts for the first three years of probation; and (4) require Schnell, during his probation, to provide written notice of his felony conviction to all his existing and new clients.

In January 1998 Walsh rejected the hearing officer's proposed decision and "order[ed] that the entire record be prepared for [his] review of the decision." Walsh then twice renewed Schnell's license; Walsh left the directorship in early 1995.

After Walsh departed, Thelma Snow Walker became acting director. Walker discussed Schnell's case with Assistant Attorney General David Stebing. Walker indicated to Stebing that Walsh had made no decision on the matter and that Stebing's file could be closed.

But in May 1995 Stebing sent a "request for decision" to the division's new director, Marianne Burke. Burke issued a notice allowing the parties "to present written argument" before "the director's final consideration of a decision in this matter." On November 1, 1995, Burke issued her "final decision." - Burke decided to suspend Schnell's license for six months and to require Schnell, upon reinstatement of his license, to give written notice of his felony tonviction to all new and existing clients for three years. Schnell received this decision almost three years after the initial hearing before Hearing Officer Flavin, and almost three years and five months after his conviction.

Schnell appealed Burke's decision to the superior court, which reversed. It held that the state was estopped from sanctioning Schnell. It reasoned that "[rlejection of the hearing officer's recommended sanction and then inaction by the [division] constituted conduct relied upon by Schnell in believing that the matter was resolved. Because of this reliancel,] Director Burke is estopped from issuing a new decision in this case." The superior court characterized the division's delay in issuing the final decision as "inexcusable." It also held that, if estoppel did not bar the administrative decision, the grounds for the sanctions required clarification.

The state appeals.

III, DISCUSSION

A. Standards of Review

The superior court sat as an intermediate court of appeal reviewing the agency decision. In such cases, we independently review the merits of the administrative determination, giving no deference to the superior court's decision.

The standard of review for appeals of administrative decisions varies depending on the type of administrative determination being challenged. Because this case addresses multiple types of administrative determinations, we will discuss the respective standards of review in context of each issue.

B. Does Equitable Estoppel Bar the State's Action Against Schnell's License?

The state argues that the superior court erred in holding that the state was equitably estopped from suspending and conditioning Schnell's insurance license. Schnell argues that the following conduct of the state's agents estops the state from now acting against his license: (1) Walsh's rejection of the hearing officer's proposed decision; (2) Walsh's subsequent renewals of Schnell's license; (8) the three-year lag between the hearing and Burke's final decision; and (4) Walsh's statements to Schnell and his New York Life supervisor that led them to believe that the matter was concluded.

Although we give no deference to the superior court's holding, Schnell urges us to affirm it based, among other things, on the superior court's estoppel theory. Whether equitable estoppel applies here is a question of law not involving agency expertise We therefore apply the substitution of judgment standard of review as to this issue.

Courts may apply the doctrine of equitable estoppel against the state, even when the state acts as the sovereign. We have rarely applied estoppel to bar the state's exercise of its sovereign police powers, reasoning that where "a [government] acts for the good of its citizens rather than a narrow proprietary interest," estoppel would be unjust to the public. But the public interest does not altogether bar the application of estoppel against the state when it acts as sovereign. Rather, as we held in Mu-micipality of Anchorage v. Schneider, the public interest is best protected through careful application of the estoppel test itself, which weighs the prejudice to the public interest in each case.

In Wassink v. Hawkins, we reiterated the four-part test that applies when a litigant seeks to invoke estoppel as a defense against the government. Applied here, this test would require Schnell to show that: (1) the division asserted a position by conduct or words; (2) Schnell acted in reasonable reliance on the division's assertion; (8) Schnell suffered resulting prejudice; and (4) estop-ping the division from acting against Schnell's license serves the interest of justice so as to limit public injury.

Arguing that the four necessary cle-ments are absent here, the state first contends that the division did not assert a position by words or conduct. Schnell argues that Walsh's conduct was an assertion of a position for purposes of the estoppel test.

That Mr. Walsh rejected the recommendations of the hearing officer, Mr. Flavin, failed to enter any order within the statutory time period, issued two unconditional license renewals, and indicated to [Schnell and Schnell's supervisor] that the matter was resolved, are all indicative that a director's decision had been made.

But, for reasons we now discuss, these acts or omissions did not amount to an assertion of a position by the state.

It is correct that Walsh rejected Flavin's proposed decision, but he was entitled to do so under AS 44.62.500(b) and (c). The state correctly argues that when Walsh did so, "he was not expressly or implicitly asserting a position that the matter was resolved without sanction." Alaska Statute 44.62.500 makes this point clear.

That statute gave the division several options when it received the hearing officer's proposed decision. It could have (1) adopted the proposed decision in its entirety; (2) reduced the proposed penalty and adopted the balance of the proposed decision; or (8) rejected the proposed decision in its entirety. If an ageney chooses to reject a proposed decision, it "may decide the case upon the record, ... or may refer the case to the same or another hearing officer to take additional evidence." By "not adopting" Fla-vin's proposed decision, Walsh did not "decide the case" in Schnell's favor. Rather, he deferred reaching a decision.

Walsh twice renewed Schnell's license after rejecting the proposed decision. Schnell asserts that these "unconditional" renewals signify that Walsh had, in fact, reached a final decision not to revoke or suspend Schnell's license.

But the renewals bore no such explicit or implicit assertion. The relevant statute does not condition renewal on the absence of any pending division action against the license. Because the statute does not deny the director discretion to renew pending an unresolved license proceeding, renewal is not an assertion that an unclosed proceeding would be abandoned. We also note that if renewal could be the basis for estoppel, it would put a great burden on the state's licensing agencies, predictably increasing both the cost of licensing and the risk that regulated professions pose to the public.

Relying on AS 21.06.220(a), Schnell would next find an "assertion" in Walsh's failure to issue a decision within the thirty-day period specified in that statute, or in the asserted untimeliness of Burke's decision. He cites Crum v. Stalnaker for the proposition that "an agency's silence can be relied 'upon to satisfy the first element of estoppel."

Despite the statute's "shall" language, the state argues that the statutory time limit is "directory and not mandatory." The state apparently means that the thirty-day limit defines a period within which the director should issue a decision, but does not bar the director from taking action even if it is not taken within thirty days. Preclusion would arguably follow if we construed the time period as "mandatory."

We have never before considered whether AS 21.06.220's thirty-day limit is directory or mandatory. Another court, however, has held that the thirty-day provision in a nearly identical statute was directory and not mandatory. In Commissioner of Insurance v. Stryker, the Georgia Court of Appeals held that "[in its ordinary significance, 'shall is a word of command; however, in the absence of injury to the defendant and in the absence of a penalty for failure to comply with the statute, 'shall denotes simple futurity rather than a command." By that analysis, Schnell's argument that the thirty-day limit barred action against his license turns on whether the delay injured him and whether the statute imposes a penalty for lack of compliance.

Schnell argues only that the division's three-year delay harmed him. The type of reliance and prejudice he alleges-time futilely spent building an insurance practice, lost alternative business opportunities, and lost deferred compensation-was potentially significant.

But, like the statute in Stryker, AS 21.06.220 imposes no penalty or consequences for failing to rule timely. Schnell would read into AS 21.06.220 an absolute bar on state action taken after the thirty-day period expires, but it is unlikely that the legislature intended such an interpretation of AS 21.06.220. To read it that way could lead to absurd and undesirable results; failing to issue a decision within thirty days would forever insulate a license holder from justifiable action against his or her license.

Nor do we agree with Schnell that failing to issue a decision within the period specified in subsection .220(a) must be deemed an "assertion" for equitable estoppel purposes. The failure to make an "order on hearing" within thirty days was not an assertion that Schnell's matter had been or would be favorably resolved. Silence is not sufficient to bar state action in this situation. Moreover, this was an administrative disciplinary proceeding in a heavily regulated profession. Even if the delay was unreasonable, it would be contrary to the public interest to remedy the agency's delay by allowing a violation to go undisciplined. As we held in In re Triem "[the public's faith in the system is harmed by lengthy adjudications of discipline matters, but dismissing the matter would simply exacerbate the injury to the public interest."

For similar reasons, we also reject Schnell's argument that Burke's final decision was statutorily untimely.

We therefore conclude that any failure to adhere to the statute did not give rise to an "assertion," for Wassink purposes, that Schnell would never be sanctioned.

Finally, Schnell claims that Walsh's conversations with Schnell and Schnell's supervisor led them to believe that "the matter was over" and that "the Director had decided to impose no sanctions." We first reject the state's argument that these statements are hearsay; they are admissions of a party-opponent-the state-and therefore admissible non-hearsay.

Nonetheless, these statements are not "assertions" for estoppel purposes. As we held in In re Stephenson, "it is well established that a state is not estopped to assert a result dictated by its rules, even if a state officer has made a contrary representation from the terms of the rules ... and caused reliance on such representation."

If Walsh's words were representations that the division would not sanction Schnell, they would be "contrary representations from the terms of the rules." That is, Walsh could not issue a decision after rejecting Flavin's proposal without "giving the parties the opportunity to present either oral or written argument before the agency." _ Moreover, Walsh made his statements ex parte, during informal conversations with Schnell and his managing partner. Thus, whatever Walsh said, and however great Schnell's reliance thereon, his words did not estop the state from later rendering a decision in accordance with its rules.

Because the first element necessary for equitable estoppel is absent, we need not consider the other three elements.

C. Does Laches Bar the State's Action Against Schnell's License?

Schnell alternatively argues that we should affirm because laches barred the state from acting. The state argues that Schnell cannot overcome the threshold question in such cases: whether the doctrine applies. It also argues that Schnell cannot satisfy the two-part test for applying the doctrine, and that applying laches for nonenforeement of law for agency delay would be contrary to the public interest. Whether the doctrine of laches applies here is a question of law not involving agency expertise We therefore apply the substitution of judgment standard of review.

As we stated in Concerned Citizens of South Kenai Peninsula v. Kenai Peninsula Borough, the doctrine of laches "creates an equitable defense when a party delays asserting a claim for an unconscionable period." To bar a claim under laches, "[a] court must find both an unreasonable delay in seeking relief and resulting prejfu-dice to the defendant." Laches is usually invoked to bar a claim because the plaintiff has unreasonably delayed seeking relief or protecting a known right." Laches has been invoked in special cireumstances to bar claims due to prosecutorial delay, but it does not bar claims due to adjudicatory delay.

The division did not delay seeking relief or prosecuting its case. It sought revocation of Schnell's license in July 1992, two months after he was sentenced for false declaration. The revocation hearing was held in November 1992 and the hearing officer issued his recommendation in December. The division's delay therefore was not in seeking relief, but in rendering its decision and imposing sanctions. Schnell concedes as much when he states in his appellate brief, "[The concern here is not about the director's delay in first raising issues ... in 1992, but about the delay of directors in promulgating sane-tions after the 1992 hearing until 1995."

Because the division's delay here was adjudicatory, we decline to apply the doctrine of laches to bar the state's action against Schnell's license.

D. Does Res Judicata Bar the State's Action Against Schnell's License?

Schnell argues that because "Walsh rejected the sanctions recommended by Hearing Officer Flavin, which are similar to the sanctions now sought to be imposed by Director Burke," the doctrine of res judicata bars Burke from reaching a result different from the result Walsh reached. Whether res judicata bars the state's action here is a question of law not involving agency expertise. We therefore apply the substitution of judgment standard of review.

Res judicata requires that a judgment be final. As we saw above in Part ILB, Walsh's rejection of Flavin's proposed decision was not a final decision. Schnell's res judicata claim therefore fails.

E. Must the Sanctions Against Schnell Be Reconsidered?

Schnell argues that his sanctions are excessive; he claims that his trouble-free record during the long delay in imposing the sanctions confirms his assertion that public protection does not require the harsh sanctions imposed in 1995. The most onerous sanction appears to be the requirement that he give written notice of his conviction to new and existing clients for three years after his suspension ends.

Before issuing her final decision in 1995, the director issued a notice that permitted the parties to present "written argument." She accepted additional written evidence from the attorney general (bearing on Schnell's pre-1992 conduct) and from Schnell (short 1995 letters from Schnell and his supervisor alleging Schnell's good professional behavior). She conducted no new hearing to supplement the 1992 hearing conducted by the hearing officer, and did not reopen the 1992 hearing. The two short letters Schnell submitted might have supported lesser sanctions; there was no evidence of any misconduct between 1992 and 1995. There was thus no unfavorable current information available to the director in 1995.

The director noted Schnell's clean 1992-95 record when she imposed sanctions in 1995; although she declined to revoke his license, she imposed the sanctions "to affirm professional standards and to protect the public."

After the sanctions were imposed, Schnell appealed and sought a stay in the superior court. His stay motion papers included detailed affidavits from Schnell and his supervisor discussing the long delay, the facts on which Schnell based his estoppel and laches arguments, the severe effect the sanctions would have on Schnell, and Schnell's good professional record. The superior court granted the stay pending appeal.

In addition to the equitable arguments we reject above in Parts IILB and C, Schnell also argued in the superior court that the sanctions were excessive and arbitrary, and were so harsh that they were equivalent to revoking his license; he also argued that lesser sanctions (such as increased monitoring and reporting by his employer, special bonding, continuing education, and account auditing) would suffice. He sought complete relief. He alternatively asked the superior court to remand and instruct the director to conduct a new hearing at which Schnell's record to the date of the new hearing could be presented and considered.

The superior court granted Schnell complete equitable relief, but also observed that if estoppel did not bar the director, it would have been necessary to remand so the agency could clarify the exact grounds for the sanctions.

It is undisputed that Schnell had been convicted of a felony, and that the director has authority to suspend or revoke the license of a person convicted of a felony. The state correctly argues that the director has broad discretion to decide what sanction is appropriate. But such broad discretion must be exercised reasonably, based on the relevant information. Schnell's professional record is highly relevant.

Although we have reversed the superior court's grant of complete equitable relief to Schnell, we think it is necessary to allow the alternative relief that the superior court indicated it would grant if estoppel did not apply: remand to the division with instructions to clarify its sanctions order. We further conclude that, on remand, the division must conduct a hearing to consider current evidence relevant to the issue of sance-tions, including evidence of Schnell's post-1992 conduct and other cireumstances addressed in the two affidavits supporting Schnell's 1995 superior court motion for stay.

Schnell did not have an opportunity to present new sanctions evidence before the director issued her final decision; the director's July 1995 Notice of Opportunity only gave Schnell "an opportunity to present additional argument" pursuant to AS 44.62.500(c). But the updated evidence that Schnell presented to the superior court was highly relevant to the issue of sanctions. It described Schnell's post-1992 conduct, the current effect that the hearing officer's proposed sanctions would have, and alternative supervisory controls available through Schnell's employer.

As we have already indicated, this evidence was insufficient to justify dismissal of the administrative action. But given the exceptionally long period of delay before the director's final sanctions decision, as well as the importance of basing that decision on current information, we conclude that it was incumbent on the director to offer Schnell an opportunity to present updated sanctions evidence and to request a pre-decisional hearing on the sanctions issue.

IV. CONCLUSION

Equitable estoppel does not bar the division because an essential element of that doctrine is absent. And laches does not apply to adjudicatory delay. We therefore REVERSE the superior court's decision on these issues. But because the 1995 sanctions decision was made without benefit of current evidence highly relevant to the sanctions issue, we AFFIRM the superior court's alternative disposition. Accordingly, we REMAND with directions that the division reconsider its sanctions decision after conducting a hearing on the sanctions issue in accordance with this opinion.

CARPENETI, Justice,

concurring.

After rejecting the hearing officer's recommendations, Director Walsh failed to enter any order within the period required by the statute, failed to issue any formal order for over two years, issued two unconditional 1i-cense renewals, and affirmatively stated to Schnell or his supervisor on more than one occasion that the matter was resolved in Schnell's favor. I would hold that these facts, collectively, amount to "assertion of a position" for purposes of the test regarding when estoppel may be invoked against the government.

I agree with the court that rejection of the hearing officer's recommendations, without more, is not an assertion of the position that the case was being decided in Schnell's favor; the director was free to decide the case differently himself or to refer it to another hearing officer. Nor did issuance of two unconditional license renewals necessarily suggest anything more than that the matter remained under review. And I agree that the long period of delay after the director rejected the hearing officer's recommendation did not constitute an assertion. All of these occurrences, individually or collectively, can mean something other than that the case was being resolved in Schnell's favor.

But I cannot agree with the court that the director's statements to Schnell and Schnell's employer, considered in the context of all of the facts, do not constitute "assertions" within the meaning of our cases. By affidavit, Schnell's supervisor established that he had had a number of "conversations with Mr. Walsh in which [Mr. Walsh] indicated that he had decided that Mr. Schnell should be able to proceed with his career in the industry, without sanctions." With specific reference to a meeting in July 1994, that supervisor reported that he thanked Walsh for refusing to impose sanctions and that "Mr. Walsh responded that he just could not see taking away Mr. Schnell's livelihood, especially 'so late in the game,' or words to that effect, and that he was glad that the issue was behind Mr. Schnell." The state has not contested that these statements were made. In these cireumstances, the conclusion seems inescapable that the state asserted a position in this matter.

The court avoids that conclusion by relying on a case that is quite distinguishable from the present case, factually and legally. In In re Stephenson, an applicant for admission to the state bar argued that the bar should be estopped from denying him admission because he was misled into believing that he was eligible for reciprocity as the result of the state bar supplying him with only a part of the information (state statutory requirements) pertinent to bar admission and not providing him with other relevant material (a state bar rule).

Stephenson is factually distinguishable because in the present case there is no dispute from the state that Walsh made the statements attributed to him by Schnell. Yet the state bar in Stephenson denied Stephenson's allegations and we decided the case on that distinguishing fact; "The Executive Director has further denied under oath that he furnished erroneous information to the applicant as to the requirements for admission. We thus find no merit to this contention."

More importantly, Stephenson is legally distinguishable from the present case. After disposing of Stephenson's claim on factual grounds, we went on to state the rule the court relies on today: "Furthermore, ... a state is not estopped to assert a result dictated by its rules, even if a state officer has made a contrary representation from the terms of the rules ... and caused reliance on such representation." The "result dictated by its rules" in Stephenson was that a bar applicant was not entitled to admission by reciprocity under the facts of that case. And that remained so no matter what the applicant might have been told. But the rules in this case do not dictate any particular outcome for Schnell. Walsh, the division director charged with the responsibility of deciding Schnell's case, had the power to "decide the case upon the record ... with or without taking additional evidence." He was free to do exactly what he had told Schnell he had done: allow him to proceed in his career without sanctions.

It is true, as the court notes, that Walsh was under the statutory obligation to give the parties the chance to present oral or written argument before rendering his final decision, and that he did not do so. This procedural failure, however, should not form a basis for concluding that. the state did not make an assertion to Schnell.

Concluding that Schnell met the first part of the Wassink test, I would consider the other requirements of that case. While Schnell's reliance on the state's assertions appears reasonable to me, and there is evidence that he suffered some prejudice as a result, I do not believe that estopping the division from taking action in regard to Schnell's license "serves the interests of justice so as to limit public injury." I reach this conclusion for the reasons the court sets out in its discussion of administrative delay: in a disciplinary proceeding in a heavily regulated profession, it would be contrary to the public interest to remedy the agency's delay by allowing a violation to go undisciplined.

For this reason, and because I agree that the sanctions decision should have been made {and should now be made) with current information, I agree with the court's remand of this case for a hearing to consider current evidence relevant to the issue of sanctions.

      . See AS 21.27.410(a).

      . See AS 44.62.560(a).

      . See Bruner v. Petersen, 944 P.2d 43, 47 n. 5 (Alaska 1997) (citing Handley v. State, Dep't of Revenue, 838 P.2d 1231, 1233 (Alaska 1992).

      . See Kachemak Bay Watch, Inc. v. Noah, 935 P.2d 816, 821 (Alaska 1997).

      . See Power Constructors, Inc. v. Taylor & Hintze, 960 P.2d 20, 26 (Alaska 1998).

      . See Kachemak Bay Watch, 935 P.2d at 821 (citing Handley, 838 P.2d at 1233; Kjarstad v. State, 703 P.2d 1167, 1170 (Alaska 1985)).

      . See, e.g., Crum v. Stalnaker, 936 P.2d 1254, 1258 (Alaska 1997) (holding that equitable estop-pel barred state from rejecting Crum's late application for retirement benefits); Property Owners v. City of Ketchikan, 781 P.2d 567, 573 (Alaska 1989) ("Estoppel may be asserted against a public agency."); Wassink v. Hawkins, 763 P.2d 971, 975 (Alaska 1988) ("Estoppel may be invoked as a defense against the government. ...").

      . See Municipality of Anchorage v. Schneider, 685 P.2d 94, 97 (Alaska 1984).

      . Id.

      . See id.

      . See id. at 97-98.

      . 763 P.2d 971.

      . See id. at 975.

      . See id.

      . AS 44.62.500 provides in part:
      (b) If a contested case is heard by a hearing officer alone, the hearing officer shall prepare a proposed decision in a form that may be adopted as the decision in the case.... The agency itself may adopt the proposed decision in its entirety, or may reduce the proposed penalty and adopt the balance of the proposed decision.
      (c) If the proposed decision is not adopted as provided in (b) of this section the agency may decide the case upon the record, including the transcript, with or without taking additional evidence, or may refer the case to the same or another hearing officer to take additional evidence.... The agency may not decide a case provided for in this subsection without giving the parties the opportunity to present either oral or written argument before the agency.

      . See AS 44.62.500(b)-(c).

      . AS 44.62.500(c).

      . See AS 21.27.410(a).

      . AS 21.06.220(a) provides that "[wlithin 30 days after termination of the hearing, ... the director shall make an order on hearing...."

      . 936 P.2d 1254.

      . Cf. Crum, 936 P.2d at 1256 n. 3 (declining to address whether analogous statutory time period directory or mandatory); Oaksmith v. Brusich, 774 P.2d 191, 201-02 (Alaska 1989) (holding time limits for issuance of findings of fact directory, not mandatory).

      . See Commissioner of Ins. v. Stryker, 218 Ga.App. 716, 463 S.E.2d 163, 166 (1995).

      . 218 Ga.App. 716, 463 S.E.2d 163.

      . Id. at 166.

      . 929 P.2d 634, 641 (Alaska 1996); see also Attorney Grievance Comm'n v. Kahn, 290 Md. 654, 431 A.2d 1336, 1352 (1981) ("Because the purpose of disciplinary action against an attorney is to protect the public, dismissal of the disciplinary petition for the sole reason that the Attorney Grievance Commission failed to proceed with the proper dispatch is manifestly unwarranted."); Hickey v. Department of Health & Consol. Lab., 536 N.W.2d 370, 372 (N.D.1995) (''The primary purpose of professional disciplinary proceedings is to protect the public, and it would be inconsistent with the public interest to dismiss a disciplinary proceeding simply because of delays in initiating, conducting, or concluding the proceedings.").

      . See Alaska R. Evid. 801(d)(2)(D).

      . 511 P.2d 136 (Alaska 1973).

      . Id. at 143.

      . AS 44.62.500(c).

      . - Citing two other laches cases, we placed great emphasis on this factor in Jackson v. Kenai Peninsula Borough, 733 P.2d 1038, 1043-44 (Alaska 1987) (citing Moore v. State, 553 P.2d 8, 20 (Alaska 1976)). See also Concerned Citizens of So. Kenai Peninsula v. Kenai Peninsula Borough, 527 P.2d 447, 457 (Alaska 1974).

      . See Kachemak Bay Watch, 935 P.2d at 821 (citing Handley, 838 P.2d at 1233; Kjarstad, 703 P.2d at 1170).

      . 527 P.2d 447.

      . Concerned Citizens of So. Kenai Peninsula, 527 P.2d at 457. While we have been reluctant to apply laches against the state, we have refused to hold that laches may never be invoked against it. See Jackson, 733 P.2d at 1043-44.

      . Concerned Citizens of So. Kenai Peninsula, 527 P.2d at 457. In later decisions, we have tended to collapse these two "prongs." See, eg., McGill v. Wahl, 839 P.2d 393, 399 (Alaska 1992) (The analysis is actually less of a distinct two-part test than an overall balancing of equities.") (citing City of Juneau v. Breck, 706 P.2d 313, 316 n. 14 (Alaska 1985)).

      . See Dan B. Dobbs, Law of Remedies § 2.4(4), at 103 (2d ed. 1993) ("In its most orthodox form, laches is unreasonable delay by the plaintiff in prosecuting a claim or protecting a right of which the plaintiff knew or should have known, and under circumstances causing prejudice to the defendant.").

      . See id. A plaintiff may be barred by delays occurring before filing suit. See id. In unusual circumstances, claims arising under the Civil Rights Act of 1965 may be barred by delays in prosecution of a suit. See id. at 103-04 & n. 9. But see Jackson, 733 P.2d at 1038 (refusing to apply laches to eighteen-year delay in enforcing zoning ordinance by local government).

      . See Kachemak Bay Watch, 935 P.2d at 821 (citing Handley, 838 P.2d at 1233; Kjarstad, 703 P.2d at 1170).

      . See, e.g., In re Mackay, 416 P.2d 823, 838 (Alaska 1964) (citing American S.S. Co. v. Wickwire Spencer Steel Co., 8 F.Supp. 562, 566 (S.D.N.Y.1934)).

      . The notice the director required read:
      As a condition of my State of Alaska insurance license, I am required to give notice that I have been convicted of felony perjury in the United States District Court at Anchorage, Alaska, Case No. A91-122 CR, entered on June 9, 1992. Pursuant to this condition, I must provide this "Notice" to new and existing clients and secure your signature below, before I may practice on your behalf as an insurance producer. Your signature below verifies that you have read this "Notice" and understand it. If you have any questions please contact the Division of Insurance at 269-7900.

      . See AS 21.27.410(a)(7).

      . See Wassink v. Hawkins, 763 P.2d 971, 975 (Alaska 1988) (citation omitted).

      . See Op. at 356.

      . See id. at 357-358.

      . See id. at 357-358.

      . See id. at 358.

      . 511 P.2d 136 (Alaska 1973).

      . See id. at 143.

      . Id.

      . Id.

      . See id. at 138-42.

      . AS 44.62.500(c).

      . See Op. at 358.

      . Wassink v. Hawkins, 763 P.2d 971, 975 (Alaska 1988) (citation omitted).

      . See Op. at 357.


source: Caselaw Access Project

author: STEWART, Judge.

license: Public Domain

text:
    STATE of Alaska, Petitioner, v. Jesse R. DELAGARZA, Respondent.
    No. A-7505.
    Court of Appeals of Alaska.
    Sept. 15, 2000.

      Douglas H. Kossler, Assistant Attorney General, Office of Special Prosecutions and Appeals, Anchorage, and Bruce M. Botelho, Attorney General, Juneau, for Petitioner.
    Leslie Hiebert, Assistant Public Advocate, and Brant G. McGee, Public Advocate, Anchorage, for Respondent.

      Before COATS, Chief Judge, and MANNHEIMER and STEWART, Judges.
   O P I N I 0 N

STEWART, Judge.

This case requires us to decide if Jesse R. Delagarza's convictions on two Oregon criminal offenses, second-degree robbery and first-degree burglary, are "prior felony convictions" for purposes of presumptive sentencing under AS 12.55.125. Because the elements of each of these two offenses are similar to the elements of Alaska felonies, we conclude that they are "prior felony convictions."

Facts and Proceedings

On October 8, 1995, Delagarza entered the Denny's Restaurant on Denali Street in Anchorage, approached an employee, and told her to "give me the money." He then said, "I have a 44 magnum in my pants and I can show you the gun." The employee opened the cash register and gave Delagarza approximately $600 in cash. As Delagarza left, the employee cried out for help. A few customers responded and tackled Delagarza before he could flee. Delagarza's handgun discharged during the struggle.

The Anchorage Police responded and seized $691 from Delagarza and a 44 magnum Colt revolver that was listed as a stolen firearm. Delagarza admitted that he had armed himself and decided to rob Denny's.

Delagarza reached a plea agreement with the State. In return for his waiver of indictment and for his no contest plea to an information charging first-degree robbery, a class A felony, the State agreed to dismiss the other charges against Delagarza. The State alleged that Delagarza faced a presumptive sentence of 15 years under AS 12.55.125(c)(4) because Delagarza had two 1984 Oregon convictions for second-degree robbery. Dela-garza also had a 1983 Oregon conviction for first-degree burglary and a 1985 Oregon conviction for second-degree burglary.

Delagarza appeared before Superior Court Judge Elaine M. Andrews for sentencing. Judge Andrews found that four statutory aggravating factors from AS 12.55.155 applied to Delagarza's sentencing: (c)(1), a person other than an accomplice sustained physical injury as a result of defendant's conduct; (c)(9), Delagarza knew that the offense involved more than one victim; (c)(15), Dela-garza had three or more prior felony convictions; and (c)(21), Delagarza had a criminal history of repeated violations of law similar in nature to robbery. Judge Andrews imposed an unadjusted 15-year presumptive term. Delagarza did not appeal his sentence.

In September of 1998, Delagarza filed an application for post-conviction relief under Criminal Rule 835.1 and requested that an attorney be appointed to represent him. De-lagarza was assigned counsel.

Delagarza then filed a motion under Criminal Rule 35(a) to vacate his sentence. Dela-garza claimed that his sentence was illegal because the two 1984 Oregon second-degree robbery convictions could not be classified as prior felony convictions for purposes of presumptive sentencing. Delagarza also moved to stay his application for post-conviction relief pending the Rule 35(a) motion.

Judge Andrews granted the stay and ordered the State to respond to Delagarza's Rule 35(a) motion. The State argued that Delagarza's Oregon robbery convictions were prior convictions for purposes of presumptive sentencing because they were the equivalent of second-degree robbery in Alaska. The State also argued that Delagarza's 1983 Oregon first-degree burglary conviction and 1985 Oregon second-degree burglary conviction could be properly construed as prior felony convictions for the purposes of presumptive sentencing. Delagarza conceded only that his 1985 Oregon second-degree burglary conviction was a prior felony conviction for purposes of presumptive sentencing. Thus, Delagarza maintained that he was only a second-felony offender for presumptive sentencing and was subject to a presumptive 10-year sentence.

In a July 19, 1999 written order, Judge Andrews examined the statutes at issue and ruled that neither Delagarza's two 1984 see-ond-degree robbery convictions nor Delagar-za's 1983 first-degree burglary conviction could be considered prior felony convictions for purposes of AS 12.55.155(c). Judge Andrews then ruled that Delagarza's 1985 Oregon second-degree burglary conviction made him a second-felony offender and invited the parties to brief the court on what steps should be taken regarding resentencing.

The State filed a petition for review of Judge Andrews' order. We granted the petition. The sole issue for our review is whether Delagarza's Oregon convictions for first-degree burglary and second-degree robbery qualify as felonies in Alaska for purposes of presumptive sentencing under AS 12.55.125(c). This issue presents a question of law that we review de novo.

Discussion

Alaska Statute 12.55.145(a)(1)(B) applies when the State relies upon a conviction from another jurisdiction to trigger presumptive sentencing. This statute provides:

(a) For purposes of considering prior convictions in imposing sentence under
(1) AS 12.55.125(c), ...
(B) a conviction in this or another jurisdiction of an offense having elements similar to those of a felony defined as such under Alaska law at the time the offense was committed is considered a prior felony conviction[.]

In 1996, AS 12.55.145(a)(1)(B) replaced former AS 12.55.145(a)(2), which had provided:

(a) For purposes of considering prior convictions in imposing sentence under AS 12.55.125(c), ...
(2) a conviction in this or another jurisdiction of an offense having elements substantially identical to those of a felony defined as such under Alaska law is considered a prior felony conviction.

In Harlow v. State, we observed that the legislature's change from requiring that the elements of the out-of-state offense have elements that were "substantially identical" to a requirement that the elements be "similar," established a more inclusive test for determining which out-of-state crimes qualify as "prior felony convictions" for presumptive sentencing purposes.

Does first-degree burglary under Oregon law have elements similar to a felony under Alaska law?

In Wells v. State, we concluded that second-degree burglary under Oregon law had elements that were "substantially identical" to second-degree burglary under Alaska law. Accordingly, second-degree burglary under Oregon law would necessarily satisfy the more inclusive test of "similar" elements under AS 12.55.145(a)(1)(B). And because Oregon's first-degree burglary statute requires proof of the elements of Oregon's second-degree burglary statute, the Oregon crime of first-degree burglary is necessarily similar to the Alaska felony of second-degree burglary.

A person commits first-degree burglary under Oregon Revised Statute (hereinafter ORS) 164.225 if:

the person violates ORS 164.215 [that is, commits second-degree burglary] and the building is a dwelling, or if in effecting entry or while in a building or in immediate flight therefrom the person: (a) Is armed with a burglar's tool as defined in ORS 164.235 or a deadly weapon; or (b) Causes or attempts to cause physical injury to any person; or (c) Uses or threatens to use a dangerous weapon.

In Martin v. State, the defendant pled no contest to second-degree burglary in violation of AS 11.46.310. The superior court examined Martin's prior Oklahoma conviction for felony escape and found that the Oklahoma felony had elements "substantially similar" to AS 11.56.8310 (second-degree escape), and that Martin could therefore be sentenced as a third-felony offender. We held that the superior court did not err and stated:

Although there are differences between the elements of the Oklahoma and Alaska statutes, those differences render the Oklahoma statute more restrictive than the Alaska statute. Accordingly, while it appears that there may be some cases where a defendant convicted under the Alaska statute would not be convicted under the Oklahoma law, the converse is not true: any offender who could be convicted under the Oklahoma law would be subject to conviction under the elements of the Alaska statute as well. Under these circumstances, any differences between the legislative schemes will not preclude a finding of substantial similarity.

Under this analysis, an out-of-state conviction will be treated as a prior felony for purposes of presumptive sentencing if the elements of the out-of-state statute are more restrictive than the Alaska statute. Oregon's first-degree burglary statute meets this test. In order to prove first-degree burglary in Oregon, the prosecution must prove all the elements of Oregon's second-degree burglary statute and the additional elements specified in the first-degree burglary statute. Any offender, like Delagarza, who is convicted of first-degree burglary in Oregon, would necessarily be convicted for second-degree burglary. We held in Wells that the elements of Oregon second-degree burglary were "substantially identical" to second-degree burglary in Alaska. Therefore, we conclude that the elements of Oregon's first-degree burglary are similar to an Alaska felony-second-degree burglary.

Does second-degree robbery under Oregon law have elements similar to a felony under Alaska law?

The State asserts that Delagarza's Oregon convictions for second-degree robbery are prior felony convictions for purposes of presumptive sentencing. The State argues that Oregon's second-degree robbery statute requires proof of the elements of Oregon's third-degree robbery statute, and the elements of Oregon's third-degree robbery statute are similar to Alaska's second-degree robbery statute.

Oregon's, second-degree robbery statute, ORS 164.405, provides that a person commits that crime if "the person violates ORS 164.395 [that is, commits third-degree robbery] and the person (a) represents by word or conduct that the person is armed with what purports to be a dangerous or deadly weapon; or (b) is aided by another person actually present." Oregon's third-degree robbery statute, ORS 164.895 provides that a person commits that crime if;

in the course of committing or attempting to commit theft, the person uses or threatens the immediate use of physical force upon another person with the intent of: (a) preventing or overcoming resistance to the taking of the property or to retention of the property thereof immediately after the taking; or (b) compelling the owner of such property or another person to deliver the property or to engage in other conduct which might aid in the commission of the theft.

In Alaska, a person commits the crime of second-degree robbery if;

in the course of taking or attempting to take property from the immediate presence and control of another, the person uses or threatens the immediate use of force upon any person with intent to (1) prevent or overcome resistance to the taking of the property or the retention of the property after taking; or (2) compel any person to deliver the property or engage in other conduct which might aid in the taking of the property.

On their face, each statute requires the prosecution to prove that a defendant used or threatened to use force on any person to overcome the resistance of any person to the theft or taking of property or to compel anyone to deliver the property or enable the theft or taking of the property.

Delagarza argues that the elements of third-degree robbery in Oregon are not similar to second-degree robbery in Alaska. De-lagarza notes that the Oregon statute penalizes assaultive conduct "in the course of committing or attempting to commit theft" while Alaska's statute penalizes assaultive conduct "in the course of taking or attempting to take property."

Robbery is traditionally a combination of theft and assault. Oregon's robbery statutes refer to the theft requirement as "theft," while Alaska's robbery statutes, which were derived from the Oregon robbery statutes, refer to the theft requirement as "taking of property." Delagarza argues that the Oregon robbery statute is not similar because Oregon emphasizes the theft nature of the crime, whereas in Alaska, robbery is a crime against the person. However, this contention is not supported by Oregon case law. In State v. Hall, the Oregon Court of Appeals reviewed the legislative history of their robbery statutes, and concluded that "it appears that the legislature intended that the assault aspect of the crime of robbery be dominant[.] ... We conclude that ... the distinctive aspect of robbery is the threat of violence to a person[.]"

Delagarza also argues that the Oregon and Alaska statutes differ because Alaska's robbery statutes require that the property that is the subject of the robbery must be in the "immediate presence and control of another" whereas the Oregon statute does not contain that specific language. Because of this, Delagarza posits that in Oregon the property that is the subject of the robbery does not have to be anywhere near a person who is subjected to the element of force in a robbery. However, in McGrew v. State, this court interpreted the robbery statute and observed that a person commits robbery under AS 11.41.510 "whenever a defendant uses foree upon any person with the intent to prevent or overcome anyone's resistance to the taking, or to compel any person to engage in conduct that might facilitate the taking." This analysis of the Alaska robbery statute does not require that the property be in the presence of the person who is subjected to a defendant's force or threat of force. For instance, an assault on a bank guard standing outside a building would qualify as a robbery even though the robber's ultimate goal was a vault located one hundred yards away in the basement. Thus, we conclude that Delagarza has not shown that a defendant's conduct that could result in a conviction of third-degree robbery in Oregon would not also support a conviction of second-degree robbery in Alaska.

Even if there might be conduct that would be penalized by the Oregon statute, but not Alaska's, that does not prevent a conclusion that the elements of the Oregon statute are similar. In Borja v. State, we examined whether the elements of a California offense were sufficiently similar to an Alaska felony for purposes of presumptive sentencing. In Borja, we analyzed that question under AS 12.55.145(a)(2), the predecessor to AS 12,55.145(a)(1)(B), the statute we apply here. We observed as follows:

Moreover, even if it were possible to identify conduct that was clearly included within the California offense and clearly excluded from the Alaska offense, this would not necessarily be fatal to the superior court's ruling. AS 12.55.145(a)(2) does not require that the out-of-state offense be identical to an Alaska felooy-only that its elements be "similar" to those of an Alaska felony. Implicit in this statutory wording is the possibility that there will be some acts covered by one statute that will not be covered by the other."

Therefore, we conclude that Oregon's third-degree robbery statute has elements similar to Alaska's second-degree robbery statute.

Delagarza was convicted of two counts of second-degree robbery in Oregon in violation of ORS 164.405. As noted above, that statute requires proof of the elements of third-degree robbery from ORS 164.395. Under the analysis from Martin v. State that we applied above, an out-of-state conviction is a prior felony for purposes of presumptive sentencing if the elements of the out-of-state offense are more restrictive than those of a corresponding Alaska felony. - Oregon's second-degree robbery statute satisfies this requirement. In order to prove second-degree robbery in Oregon, the prosecution must prove all the elements of Oregon's third-degree robbery statute and the additional and more restrictive elements specified in Oregon's second-degree robbery statute. Because Oregon's offense of third-degree robbery is similar to Alaska's offense of see-ond-degree robbery, we conclude that Oregon's second-degree robbery statute has elements similar to an Alaska felony.

Conclusion

The order of the superior court granting Delagarza's Criminal Rule 35(a) motion is REVERSED.

      . - Or.Rev.Stat. § 164.405(1).

      . Or.Rev.Stat.§ 164.225(1).

      . See AS 11.41.500(b).

      . - Or.Rev.Stat. § 164.215(1).

      . Alaska Rule of Criminal Procedure 35(a) provides: "Correction of Sentence. The court may correct an illegal sentence at any time."

      . See AS 12.55.125(c)(3).

      . See Scroggins v. State, 951 P.2d 442, 443 (Alaska App.1998) (citing Borja v. State, 886 P.2d 1311, 1313-14 (Alaska App.1994)).

      . Emphasis added.

      . Emphasis added.

      . 820 P.2d 307 (Alaska App.1991).

      . Id. at 309.

      . 687 P.2d 346 (Alaska App.1984).

      . Id. at 351.

      . 704 P.2d 1341 (Alaska App.1985).

      . Id. at 1342.

      . Id. {emphasis added).

      . Id.

      . See A.L.I., Model Penal Code and Commentaries Part 11 § 222.1, at 96-115 (1980).

      . See Alaska Criminal Code Revision, Tentative Draft, Part 2, p. 110.

      . 149 Or.App. 358, 942 P.2d 882 (1997), reversed in part on other grounds, 327 Or. 568, 966 P.2d 208 (1998).

      . Id. at 885.

      . 872 P.2d 625, 626 (Alaska App.1994).

      . 886 P.2d 1311 (Alaska App.1994).

      . Id. at 1312.

      . Id. at 1314.

      . See Martin, 704 P.2d at 1342.


author: MANNHEIMER, Judge.

text:
    Harold J. SEMAKEN, Appellant, v. STATE of Alaska, Appellee.
    No. A-7473.
    Court of Appeals of Alaska.
    Sept. 22, 2000.

      Bethany P. Spalding, Assistant Public Defender, Fairbanks, and Barbara K. Brink, Public Defender, Anchorage, for Appellant.
    Kenneth M. Rosenstein, Assistant Attorney General, Office of Special Prosecutions and Appeals, Anchorage, and Bruce M. Bo-telho, Attorney General, Juneau, for Appel-lee.
    Before COATS, Chief Judge, and MANNHEIMER and STEWART, Judges.
   O P I N I 0 N

MANNHEIMER, Judge.

Harold J. Semaken was convicted of see-ond-degree sexual assault in 1990. Because of this conviction, Semaken is obliged to register as a sex offender. Each year, Semaken must report his address (and certain other information) to the Department of Public Safety.

At the time that this case arose, the Department had promulgated a regulation, 18 AAC 09.030(c), which required sex offenders to make their annual reports within the 80 days preceding their birthday Semaken, whose birthday is March 18th, was stopped for a traffic violation on March 21, 1999. During this traffic stop, the police officer discovered that Semaken had not yet made his annual report to the Department of Public Safety. As a consequence, Semaken was charged with the misdemeanor of failing to report.

In the district court, and now on appeal, Semaken asserts that the Department's former regulation is invalid because it established a general rule for all sex offenders. According to Semaken, the promulgation of such a general rule runs contrary to an explicit provision of AS 12.63.010(d).

AS 12.63.010(d)(1) declares that all sex offenders who are required to make yearly reports shall make their report "on a date set by the department at the time of the sex offender's ... initial registration" Se-maken argues that this statute requires the Department of Public Safety to specially establish an individualized annual reporting schedule for each sex offender at the time of their initial registration. We do not agree. The statute does not preclude the Department from promulgating a general rule to govern the reporting deadline for all sex offenders-in particular, to require all sex offenders to report within the 30 days preceding their birthday.

The challenged regulation, 13 AAC 09.030(c), was in effect when Semaken initially registered as a sex offender. Thus, the statute was satisfied: Semaken's annual reporting deadline was "set by the department at the time of [Semaken's] initial registration".

Moreover, the State presented evidence that Semaken had actual notice of the "birthday" requirement. A Department of Public Safety employee testified that she expressly reminded Semaken of this requirement in August 1998, when Semaken came in to report a change of address. In fact, she had Semaken sign a form acknowledging that he was required to file his annual report within the 80 days preceding his birthday and that he would be "out of compliance" if he waited until after his birthday.

The judgement of the district court is AFFIRMED.

      . See AS 12.63.010(a)-(b).

      . See AS 12.63.010(d)(1) and AS 12.63.020(a)(2).

      . This regulation has since been amended; it no longer contains a subsection (c), and it no longer specifies the 30-day period preceding the offender's birthday.

      . AS 11.56.840(a).

      . At the time of Semaken's offense, an earlier version of this same statute was in effect. However, the earlier version also contained a provision requiring sex offenders to make yearly reports on a date set by the Department at their initial registration. See former AS 12.63.010(d).


author: PER CURIAM.

text:
    In the Matter of David Robert DEMARAY, Attorney-Respondent.
    No. 99SA74.
    Supreme Court of Colorado, En Banc.
    Sept. 13, 1999.
    John S. Gleason, Attorney Regulation Counsel, James S. Sudler, Assistant Regulation Counsel, Denver, Colorado, Attorneys for Complainant.
    No Appearance by or on Behalf of Attorney-Respondent.
   PER CURIAM.

David Robert Demaray is the respondent in this lawyer discipline case. He defaulted before the grievance committee and has not appeared in this court. A hearing panel of the grievance committee approved the findings and recommendation of a hearing board that Demaray be suspended for three years for his abandonment of a client in a eriminal case. We accept the panel's and board's recommendations and suspend Demaray for three years.

I.

David Robert Demaray was admitted to practice law in Colorado in 1996. He did not answer the formal complaint filed in this case, and he failed to appear at the hearing or submit any evidence in response to the complaint. As a result, the board entered a default against him and the facts of the complaint were deemed proven. See C.R.C.P. 241.18(b); In re Bilderback, 971 P.2d 1061, 1062 (Colo.1999). Based on the default and the evidence presented by the complainant, the hearing board found the following facts were established by clear and convincing evidence.

On September 28, 1997, Demaray entered his appearance on behalf of a client in a misdemeanor criminal case. Trial was set for December 8, 1997, but Demaray did not inform his client of the setting. After neither Demaray nor his client appeared for trial, a bench warrant was issued for the client's arrest and Demaray was ordered to appear on January 16, 1998 and show cause why he should not be held in contempt. When Demaray did not appear for the show cause hearing, the court issued an order holding him in contempt and a bench warrant for his arrest.

Notice of the request for investigation filed against Demaray was sent to his business address by certified mail. He failed to respond to the request for investigation, and he did not cooperate in any way with the Office of Disciplinary Counsel.

The hearing board found that Demaray's conduct violated Colo. RPC 1.3 (neglecting a legal matter entrusted to a lawyer); 1.4(a) (failing to communicate with a client); 8.4(c) (knowingly disobeying an obligation under the rules of a tribunal); 8.4(d) (engaging in conduct prejudicial to the administration of justice); and 8.4(h) (engaging in conduct adversely reflecting on the lawyer's fitness to practice law). His failure to cooperate with the office of disciplinary counsel or the grievance committee, and his default in these proceedings, violated Colo. RPC 8.1(b) (knowingly failing to respond to a lawful demand for information from a disciplinary authority), and C.R.C.P. 241.6(7) (failing to respond to a request by the grievance committee without good cause shown, or obstructing the committee or any part thereof in the performance of its duties).

IL

The hearing panel accepted the board's recommendation that Demaray be suspended for three years. The board found that Demaray abandoned his client, causing him at least potentially serious harm. The ABA Standards for Imposing Lawyer Sanctions (1991 & Supp.1992) (ABA Standards) provides that, in the absence of mitigating factors, disbarment is appropriate when:

(a) a lawyer abandons the practice and causes serious or potentially serious injury to a client; or
(b) a lawyer knowingly fails to perform services for a client and causes serious or potentially serious injury to a client; or
(c) a lawyer engages in a pattern of neglect with respect to client matters and causes serious or potentially serious injury to a client.

ABA Standards 441; see, e.g., People v. Townshend, 933 P.2d 1827, 1829 (Colo.1997) (disbarring lawyer who accepted advance fees from two clients then effectively abandoned them, and failed to account for or return the unearned retainers she collected, thereby converting those funds to her own use). On the other hand, suspension is the presumed sanction when: "(a) a lawyer knowingly fails to perform services for a client and causes injury or potential injury to a client; or (b) a lawyer engages in a pattern of neglect and causes injury or potential injury to a client." ABA Standards 4.42.

The record in a default proceeding such as this one is necessarily sparse. The hearing board did not find that Demaray has abandoned the practice of law. Nor does the evidence show that Demaray misappropriated any client funds by accepting a fee and then abandoning the client. Nevertheless, disbarment would still be an appropriate sanction because of the potential for serious harm to the client in this case. See ABA Standards 4 41(b), (c). Aggravating factors include the presence of multiple offenses, see id. at 9.22(d), and Demaray's bad faith obstruction of the disciplinary process, see id. at 9.22(e).

We find the existence of mitigating factors significant. Demaray has not been previously disciplined in the three years he has been licensed, see id. at 9.82(a), and he is inexperienced in the practice of law, see id. at 9.32(f). Because of the abbreviated record in this case, it is difficult to tell if Demaray's abandonment of his client was part of a pattern or if it was an isolated occurrence. In addition, the record before us fails to disclose the status of the bench warrant for Demaray's arrest or the finding of contempt. In an analogous case we said:

The respondent's apparent abandonment of his clients makes it problematical whether a period of suspension, rather than disbarment, is adequate. As we said in People v. Odom, 914 P.2d 342, 845 (Colo.1996), "[plrior caselaw would sustain either a long period of suspension or disbarment in this case. However, '[gliven the abbreviated record in these default proceedings, and the facts and circumstances of this particular case, we elect to follow the ree-ommendations of the hearing panel and impose a period of suspension rather than disbarment."

People v. Rishel, 956 P.2d 542, 544 (Colo.1998). Treating this case consistently with these other similar cases, we elect to accept the board's and panel's recommendation of a three-year suspension. Accord People v. Shock, 970 P.2d 966, 967 (Colo.1999). However, at least one member of the court would disbar Demaray for his misconduct.

IIL.

It is hereby ordered that David Robert Demaray be suspended from the practice of law for three years, effective thirty days after the issuance of this opinion. It is further ordered that Demaray shall pay the costs of this proceeding in the amount of $168.53 within thirty days after the announcement of this opinion to the Attorney Regulation Committee, 600 Seventeenth Street, Suite 200 South, Denver, Colorado 80202-5432. Demaray shall not be reinstated until he has complied with GCR.C.P. 251.29.

Justice SCOTT does not participate.


text:
    In the Matter of Gary Steven COHEN, Attorney-Respondent.
    No. 97SA211.
    Supreme Court of Colorado, En Banc.
    Sept. 13, 1999.
    John S. Gleason, Attorney Regulation Counsel, James C. Coyle, Assistant Regulation Counsel, Denver, Colorado, Attorneys for Complainant.
    Jean E. Dubofsky, Boulder, Colorado, Jay P.K. Kenney, Denver, Colorado, Attorneys for Attorney-Respondent.
   PER CURIAM.

The respondent in this lawyer discipline case, Gary Steven Cohen, was charged with representing conflicting interests. A hearing panel of the supreme court grievance committee approved the findings and conclusions of a hearing board, but modified the board's recommendation of a thirty-day suspension to ninety days. Cohen excepted to the recommendation of discipline. We accept the hearing panel's recommendation and order that the respondent be suspended for ninety days from the practice of law.

I.

Gary Steven Cohen has been licensed to practice law in Colorado since 1976. The facts underlying the complaint were hotly contested and the evidence presented to the hearing board was in stark conflict. Following the hearing, the board made the following factual findings by clear and convincing evidence.

Cohen represented Thomas Mars and his businesses, Mars Steel & Iron and Mars Steel Corporation, in a number of legal matters from 1986 through 1990. Mars's son, Zane, was seriously injured in a motorcycle accident on July 4, 1985, when he collided with another vehicle. He sustained a closed-head injury and other injuries. Zane was twenty-one years old at the time of the accident. He was subsequently charged with a criminal offense. A lawyer other than Cohen initially represented Zane on the criminal charges and in a civil action brought against the driver of the other vehicle. In 1987, Cohen took over representing Zane in both cases. In the criminal case, Cohen filed a successful motion to suppress, resulting in the dismissal of the charges. He also obtained a substantial verdict on Zane's behalf in the civil case which was eventually settled on March 80, 1989 for $750,000.

At the time of the settlement, Zane was twenty-six years old, had graduated from high school, had quite limited business and financial experience, and was suffering from the effects of a closed head injury. Zane and his parents had discussions with Cohen prior to the settlement concerning the wisest way to resolve the matter and provide Zane with some protection and future security. Eventually it was decided to place the settlement proceeds in trust with Cohen as the trustee.

It is at this point that the parties started to disagree strongly. The complainant asserted that at about the time the settlement was entered into, the parties agreed orally to create an irrevocable spendthrift trust, with Zane being the beneficiary and Cohen the trustee.

Cohen on the other hand alleges that no trust at all was created until the written trust agreement was entered into on August 28, 1989, because until that time Zane was ambivalent about whether he wanted a trust and the specific terms of the trust were not established until it was reduced to writing. According to Cohen, from the end of March to August, only a resulting trust existed, and Cohen's role was limited to being an agent responsible to the wishes of his principal, Zane.

The hearing board determined that the overwhelming weight of the evidence supported the complainant's position. "There is no question but that an oral irrevocable spendthrift trust was established on or about March 80, 1989, with Zane A. Mars as the beneficiary and Cohen as the trustee. First, Zane testified that it was his intent to create the trust when the case was settled. Second, the written agreement states that it "is made and entered into as of March 80, 1989." Third, while the first promissory note drawn by Cohen and executed by Zane's father on April 4, 1989 was originally made payable to Zane Mars, almost immediately the note was cancelled and rewritten in the name of "The Zane A. Mars Trust [hereafter "the Trust"] (Payee), Gary A. Cohen, Trustee."

In addition, subsequent promissory notes and a deed of trust referred to the Trust as the payee; Cohen's billing records beginning on March 31, 1989 charges his services to the "Z. Mars Trust"; the Trust Registration Statement refers to the trust as having been established on March 30, 1989; and Cohen obtained a tax identification number from the IRS for the trust. All of this occurred before the written trust agreement was executed on August 28, 1989. In his opening brief in this court, Cohen did not contest the board's finding that an oral spendthrift trust became effective on March 80, 1989

Before Zane's settlement was reached, there were discussions between Zane and his father concerning Mars Steel Corporation borrowing some of the settlement proceeds on a short term basis. After Zane's case was settled and the oral spendthrift trust was created, Thomas Mars persuaded his son to approve or authorize a short term loan of $50,000 to the corporation. Thomas Mars believed at the time that he would be granted a Small Business Administration loan within a short period of time. The board found that Zane felt obligated to make the loan to his father because he had supported Zane during his convalescence and the ensuing litigation. Zane and his father asked Cohen to draft a promissory note and to release the funds to the father. The maker of the note was Mars Steel Corporation. The note was unsecured, although Thomas Mars signed a personal guarantee. This was the April 4, 1989 note that was redrafted to make the Trust the payee. When Cohen prepared the note, he was still representing Thomas Mars in his business matters. He was at the same time Zane's lawyer and the trustee of the Trust.

When the April 4, 1989 note came due, Thomas Mars's application for the SBA loan had still not been approved. In fact, it was never approved because of the corporation's poor financial circumstances. Neither the corporation nor Thomas Mars paid the note when it was due. Nevertheless, even though the first loan was in default, Cohen advanced another $44,000 of the Trust's funds to the Mars Steel Corporation. He did this at the direction of Zane and his father. Cohen also prepared a factoring agreement on Mars Steel Corporation's receivables as security for the second loan. Zane testified at the hearing that he was reluctant to approve the loan and he hoped that Cohen would deny it for him. Cohen's conflict of interest was further compounded by the fact that Thomas Mars now owed him substantial attorney fees. Before drafting the documents for the first and second loans, Cohen advised both the father and son that they should have independent counsel because of his attorney-client relationship with each of them. Neither Zane nor his father obtained an independent lawyer, and Cohen drafted the notes and released the funds to Mars Steel Corporation and Thomas Mars.

About June 15, 1989, Zane told Cohen that his father was pressing him to make yet another loan from the Trust, this time for $100,000. The purpose of the loan was to pay off an IRS lien. The board found this to be a clear sign that the corporation was in severe financial trouble. Cohen told Zane to consult with another lawyer. At Zane's urging, Cohen arranged to get Zane a lawyer, who Zane said would be paid by his father. There was a lunch meeting among Zane, his father, Cohen, and the second lawyer. This lawyer did not review the documents or the details of the transaction, and Cohen knew this. Neither Cohen nor Thomas Mars provided the second lawyer with sufficient information about the financial condition of either the corporation or Thomas Mars for the lawyer to give Zane appropriate legal advice. The board concluded that Zane did not receive truly independent legal advice, and that Cohen either knew or should have known this. Nevertheless, Cohen drafted the necessary documents which involved obtaining a loan through the bank handling the Trust. As security for the bank loan, Cohen, as trustee for the Trust, executed an assignment of a $100,000 certificate of deposit owned by the Trust.

At the hearing, Cohen took the position that by drafting the promissory notes and other documents evidencing the transactions between Thomas Mars and Zane Mars and the Trust, he was simply acting as a serivener, not a lawyer. The board found otherwise by clear and convincing evidence. First, Zane considered Cohen to be his lawyer from the outset. And the instruments themselves go well beyond the terms actually conveyed to Cohen by the parties to the transactions, "and clearly reflect [al lawyer's input in the provisions."

Neither the corporation nor Zane's father repaid any of the notes. Eventually the corporation and Thomas Mars filed for bank-ruptey. Cohen took no action whatsoever to collect on any of the notes or to foreclose on the collateral, such as it was. In 1994, however, Zane and the successor trustee of the Trust settled a malpractice action they brought against Cohen and the lawyer that was supposed to provide Zane with independent legal advice. The board concluded that Zane and the Trust were thereby "made whole."

The hearing board further determined that by simultaneously representing Thomas Mars and Mars Steel Corporation, as well as Zane and the Trust, Cohen violated DR 5-101(A) (accepting employment if the exercise of the lawyer's professional judgment will or reasonably may be affected by the lawyer's own financial, business, property, or personal interests); and DR 5-105(B) (continuing multiple employment even though the exercise of the lawyer's independent professional judgment will be, or is likely to be, affected by the representation of another client, or if the multiple employment is likely to involve the lawyer in representing differing interests). He also violated DR 1-102(A)(6) (engaging in conduct adversely reflecting on the lawyer's fitness to practice) and C.R.C.P. 241.6(2) (violating accepted rules or standards of legal ethics). The board found, however, that the complainant had not proven by clear and convincing evidence that Cohen had violated DR 6-101(A)(8) (neglecting a legal matter entrusted to the lawyer). According to the board, "It is not clear that at the time the defaults occurred any action to recover on the loans would have been successful."

IL

The hearing panel generally approved the findings and conclusions of the hearing board, but modified the board's recommendation of a thirty-day suspension to a suspension for ninety days. Cohen filed exceptions to the panel's and board's recommendations.

As we mentioned above, the parties agreed that a valid spendthrift trust was created at some point; they differed only on when it came into being. After the case was at issue in this court, we ordered the parties to submit written briefs on the following issues:

Whether the Zane A. Mars Trust violates section 88-10-111 and/or public policy.
If the trust violates the statute and/or public policy, what is the effect on the existence of the trust.
If the Trust is invalid, what effect does this have on the Findings and Recommendation of the Hearing Board that found the Trust to be a valid oral spendthrift trust beginning March 1989.

The key issue litigated below was whether an oral spendthrift trust was created in March 1989 or the trust came into being when it was put in writing in August 1989. Cohen and his expert witnesses testified that the trust only came into existence in August, whereas the complainant asserted that it began in March. The gravamen of the complaint was that Cohen as trustee breached the prudent investor rule by permitting the trust to lend a total of $200,000 between March and August to Zane's father's business, which was not repaid because the business failed. Cohen's position was that, until August 1989, he acted as the agent of his principal, Zane, in permitting Zane to loan his father the funds. Therefore, when he made the loans at issue (all before August 1989) he was merely acting as an agent obeying the orders of Zane, his principal. According to the argument Cohen presented to the hearing board, his actions were not unethical because they did not breach any duties relevant to a straight principal-agent relationship. The hearing board, however, found that an oral trust came into being in March so that Cohen should not have allowed the loans.

Apparently, the parties had no interest in questioning the validity of the written spendthrift trust. However, Restatement (Second) of Trusts § 156 (1959) states:

§ 156. Where the Settlor is a Beneficiary.
(1) Where a person creates for his own benefit a trust with a provision restraining the voluntary or involuntary transfer of his interest, his transferee or creditors can reach his interest.
(2) Where a person creates for his own benefit a trust for support or a discretionary trust, his transferee or creditors can reach the maximum amount which the trustee could pay to him or apply for his benefit.

As one commentator has stated:

Even in jurisdictions in which spendthrift trusts are permitted, the settlor cannot create a spendthrift trust for his own benefit. If the owner of property transfers it in trust to pay the income to himself for life or for a period of years, and provides that his interest under the trust shall not be assignable by him and that his creditors shall not be permitted to reach it, nevertheless he can effectively assign his interest and his creditors can reach it. It is immaterial that in creating the trust the settlor did not intend to defraud his eredi-tors.... It is against public policy to permit a man to tie up his own property in such a way that he can still enjoy it but can prevent his creditors from reaching it.

William F. Fratcher, IIA Scott on Trusts § 156, at 164-67 (4th ed.1987) (emphasis added); see also Hanson v. Minette, 461 N.W.2d 592, 595 (Iowa 1990) ("While the trust contains spendthrift-type language, it is universally held that a settlor may not create a spendthrift trust in favor of himself."); In re Johanmes Trust, 191 Mich.App. 514, 479 N.W.2d 25, 29 (1991) (concluding that the creditors could reach the assets of a "spendthrift" trust to the same extent as the maximum amount that would be payable to the beneficiary in the trustee's discretion); Miller v. Ohio Dep't of Human Servs., 105 Ohio App.3d 539, 664 N.E.2d 619, 621 (1995) (self-settled spendthrift trusts are void as against public policy); Farmers State Bank v. Janish, 410 N.W.2d 188, 190 (S.D.1987) (spendthrift trust created by beneficiary and other parties out of sums they received in settlement of personal injury action was open to garnishment by beneficiary's creditors). Although there is language in the written trust that the settlors are Thomas Mars as next friend and Zane Mars, the evidence is clear (and Cohen so testified) that the real settlor was Zane alone. This very principle is embodied in the statutes of several states, including Colorado. Section 838-10-111, 10 C.R.S. (1997) provides:

38-10-111. Trusts for use of grantor void against creditors. All deeds of gift, all conveyances, and all transfers or assignments, verbal or written, of goods, chattels, or things in action, or real property, made in trust for the use of the person making the same shall be void as against the creditors existing of such person.

(Emphasis added.) In addition, the Restatement indicates that any attempt by the settlor-beneficiary to transfer, assign, or alienate the income or principal of the trust will be successful. See Restatement (Second) of Trusts § 156; IIA Scoit on Trusts, supra, § 156, at 164-65.

In his supplemental brief, Cohen now argues that the oral spendthrift trust that he created violated both section 38-10-111 and public policy. With respect to section 88-10-111:

Zane's transfer of settlement proceeds into the oral irrevocable spendthrift trust, while reserving the beneficial interest to himself, would not protect the proceeds from his existing creditors. There is no indication in the record that Zane had any existing creditors at the time the settlement proceeds became subject to the oral trust.

Cohen assumes that section 38-10-111 only applies to creditors of the settlor-beneficiary at the time the trust is created. See In re Baum, 22 F.3d 1014, 1017 (10th Cir.1994) (construing section 38-10-1111 to apply only to creditors existing at time trust was created). The complainant makes the same assumption, but concludes that while the trust may not be valid as -to creditors, it is not thereby void. But even if there were no creditors at the time the trust was settled, the oral irrevocable spendthrift trust could not and did not protect the settlor-beneficiary from future creditors. See Restatement (Second) of Trusts § 156, IIA Scott on Trusts, supra, § 156, at 164-67. If we were to believe Cohen that he thought he was merely Zane's agent regarding the trust and therefore subject to Zane's orders regarding disposition of the proceeds, we would be forced to conclude that the Trust "was illusory and fraudulent" as against any creditors of Zane. See Kaladic v. Kaladic, 41 Colo.App. 419, 422, 589 P.2d 502, 505 (1978). In Kaladic, eleven months before the wife filed a dissolution of marriage action, she established an irrevocable, discretionary, spendthrift trust because of what she viewed as excessive drinking by the husband and because of his statements indicating to her that he was financially irresponsible. See id. at 420, 589 P.2d at 504. The wife was the sole income beneficiary and her lawyer was the trustee. See id. The court of appeals held:

Here, the conveyance of marital assets by the wife into an irrevocable, discretionary trust without her husband’s knowledge was properly set aside by the trial court. It was illusory and fraudulent as against his rights. The trust assets were subject to division as marital property under § 14-10-113(1), C.R.S.1973, and the trustee held those assets as an equitable trustee.

Id. at 422, 589 P.2d at 505. Neither of the parties has argued that the spendthrift trust was set up as an illusion, a sham, or a fraud. We must therefore conclude, as did Zane and the hearing board, that when the oral trust was created, Cohen shouldered the duty of protecting Zane’s assets from wasteful depletion, and the concomitant duty of exercising his own professional judgment as to the advisability of investments to be made by the Trust—for Zane’s benefit. This duty prohibited Cohen from making ill-advised loans from the Trust for Zane’s father’s benefit or Cohen’s own benefit. This was the duty that Cohen breached.

Therefore, whether the oral or written Trust was void ab initio is immaterial for disciplinary purposes and we do not reach that question. The important thing is that the board’s findings mean that Cohen was required to protect Zane’s financial interests and this he could not, and did not, do because of the conflicts of interest that existed when the oral trust was created. Thus, we agree with the hearing board that Cohen’s conduct violated DR 5-101(A) (accepting employment when there is a conflict between the exercise of the lawyer’s professional judgment and the lawyer’s own financial, business, property, or personal interests); and DR 5-105(B) (continuing multiple employment when the exercise of the lawyer’s independent professional judgment will be, or is likely to be, affected by the representation of another client, or if the multiple employment is likely to involve the lawyer in representing differing interests).

The remaining issue is the proper level of disciplinary sanction. The hearing board recommended that Cohen be suspended for thirty days. The hearing panel modified the recommended period of suspension to ninety days “given that a thirty-day suspension was too lenient in light of the vulnerability of the respondent’s client (the son); the imprudent investments (loans) to the other client (the father); and the heightened conflict created by the indebtedness (for attorney’s fees) of the father to the respondent.”

Under the ABA Standards for Imposing Lawyer Sanctions (1991 & Supp.1992) (ABA Standards), in the absence of aggravating or mitigating factors, “[sjuspension is generally appropriate when a lawyer knows of a conflict of interest and does not fully disclose to a client the possible effect of that conflict, and causes injury or potential injury to a client.” ABA Standards 4.32.

In the way of mitigating factors, the board found that Cohen has not been previously disciplined, see id. at 9.32(a); He cooperated in these proceedings, see id. at 9.32(e); and he is held in high repute in the legal profession and the community, see id. at 9.32(g). The aggravating factors concern us, however. His conduct was motivated by a selfish purpose, see id. at 9.22(b); he did not, and still has not, actually acknowledged that his conduct was wrongful, see id. at 9.22(g); and he has remained insensitive to Zane’s vulnerability.

In In re Quiat, 979 P.2d 1029 (Colo.1999), we suspended Quiat for three months for violating DR 5-101(B) (accepting employment if the lawyer knows that he or she will be called as a witness), DR 5-105(A) (accepting multiple employment involving conflicts of interest), and DR 5-105(B) (continuing multiple employment involving conflicts of interest). The conflicts in the Quiat case involved his simultaneous representation of a debtor, the debtor's estranged wife, and the debtor's children in a bankruptcy. See Qui-at, 979 P.2d at 1041-42. As in this case, at least a short period of suspension was appropriate. See id. at 1048. Although we considered a suspension for thirty days, we found it notable that "Quiat's failure to appreciate and understand the wrongfulness of his conduct mandate a longer suspension." Id. We suspended Quiat for three months. Cohen has similarly failed to appreciate the extent of his wrongful conduct. We therefore agree with the hearing panel that a ninety-day suspension is warranted.

IIL.

Accordingly, we order that Gary Steven Cohen be suspended from the practice of law for ninety days, effective thirty days after the issuance of this opinion. We also order Cohen to pay the costs of this proceeding in the amount of $6,006.42 within ninety days after this opinion is announced to the Attorney Regulation Committee, 600 Seventeenth Street, Suite 200 South, Denver, Colorado 80202-5482.

Justice BENDER does not participate.

      . A "spendthrift trust" is "'a trust created to provide a fund for the maintenance of the benefi-clary, and at the same time to secure it against his improvidence or incapacity.' 65 C.J. 230." Newell v. Tubbs, 103 Colo. 224, 227, 84 P.2d 820, 821 (1938). In general, spendthrift trusts are valid and enforceable in Colorado. See University Nat'l Bank v. Rhoadarmer, 827 P.2d 561, 563 (Colo.App.1991).

      . Before the hearing board, neither the parties nor their expert trust witnesses raised or discussed the issue of whether a spendthrift trust in which the settlor is also the sole beneficiary was valid. Nor was the issue raised in the parties' original briefs to this court. After the case was submitted to the court, we sua sponte ordered the parties to address the issue of the Trust's validity and the effect on the board's finding and recommendation if the Trust was in fact invalid. These issues are addressed below.

      . Restatement (Second) of Trusts § 39 (1959) provides that "[e}xcept as otherwise provided by statute, an enforceable trust can be created without a writing."