Rehnquist In-Law Files Action Over Trust

The disabled brother-in-law of Chief Justice-designate William H. Rehnquist filed formal charges Thursday with the State Bar of Arizona alleging that the justice acted unethically in his handling of a family trust fund.

The complaint, filed as the Senate debates Rehnquist’s confirmation as chief justice of the United States, charges Rehnquist with conflicts of interest and repeated failures to meet his legal duties to the bedridden relative, and says his conduct raises “serious questions of ethics and integrity.”

The relative, Harold Dickerson (Dick) Cornell, 73, a former San Diego prosecutor disabled by multiple sclerosis, contends that Rehnquist joined other relatives in concealing from him for two decades the existence of a trust fund established for Cornell by his father shortly before his death in 1961.

According to Cornell, Rehnquist had a conflict of interest in connection with the trust. Rehnquist is married to Cornell’s sister, Natalie, who would have shared the trust proceeds with her sisters and another brother if Cornell had died before receiving the money.

Cornell says Rehnquist and other relatives did not disclose the existence of the $25,000 trust until 1981, after he had lived in poverty for 20 years, though its terms required payments to him as soon as his standard of living fell below the level he maintained before his illness forced him to retire from his law practice.

Rehnquist has declined to comment on the allegations since they were disclosed by The Times last month. Other relatives say it was the wish of Cornell’s father that the trust be kept secret until Cornell was near death, because he feared that the disabled lawyer would not spend the money wisely.

The complaint was filed in Arizona because Rehnquist was practicing as a private attorney there when the alleged misconduct took place.

Cornell charges Rehnquist with four breaches of legal ethics:

- That he failed to disclose his conflict of interest to Cornell’s father, Harold Davis Cornell.

- That he failed to investigate the absence of payments to Cornell by the trust, or disclose the fund’s existence to Cornell so he could investigate it.

- That, if Rehnquist was aware of the trust’s poor investment record, he failed to inform Cornell so he could have asked a court to implement better investment practices. The trust, managed by Cornell’s brother, George, until his death in 1981, grew only to $35,000 from $25,000 in its 20-year life.

- That, if Rehnquist talked with other family members about withholding information about the trust from Cornell, he could be subject to a suit alleging a breach of trust.

If Cornell’s complaint is upheld after an investigation, it could lead to Rehnquist’s censure, suspension or disbarment by the Arizona Bar.

Cornell said Thursday that he doubts that the complaint will result in formal Bar action against Rehnquist. But he said he hopes that, in concert with other criticisms, it can influence the Senate’s confirmation debate.

“It has been suggested it might, with the other information, be enough to refer the determination back to the Judiciary Committee,” he said.

A self-described liberal, Cornell opposes Rehnquist’s nomination and describes his brother-in-law as “a threat to our nation.”

Previously, Cornell said, he believed that the trust matter was not “important enough” to justify a formal Bar complaint. But he decided to file the charges after discussions with San Diego-area attorneys and Boston College law Prof. Zygmunt Plater, a circulator this week of a letter signed by more than 100 professors questioning Rehnquist’s integrity and ethics.

Under Arizona Bar procedures, the complaint will first be screened to determine if it falls within the Bar’s jurisdiction. If so, Rehnquist, who remains a member of the Arizona Bar, will be mailed a copy of the complaint and have 20 days to respond.

Bar attorneys will review the case and conduct any necessary investigation, then make a recommendation to the Bar’s No. 2 officer on whether there is probable cause to hold a hearing on the charges. Upon a finding of probable cause, the Bar’s disciplinary commission would conduct a hearing on the charges.

The proceedings, which can take more than a year, would become public only if the commission imposed discipline on Rehnquist, according to Regina Williams, a Bar official in Phoenix.

Justice Department spokesman Pat Korten said Thursday that prior investigation had established that the trust fund allegations were “not a serious or substantial charge.”

An initial FBI investigation of the charges, sought by the Judiciary Committee, was inconclusive. Last week, the Justice Department declined to permit a renewed FBI investigation sought by four Democratic senators.