Docket No. 463

In the Matter of Robert Donaldson

March 24, 1993

Disposition Agreement



This Disposition Agreement (Agreement) is entered into
between the State Ethics Commission (Commission) and Robert
Donaldson (Mr. Donaldson) pursuant to s. 5 of the Commission's
Enforcement Procedures. This Agreement constitutes a final
Commission order enforceable in the Superior Court pursuant to
G.L. c. 268B, s. 4(j).

On September 10, 1992, the Commission initiated, pursuant to
G.L. c. 268B, s. 4(a), a preliminary inquiry into possible
violations of the conflict of interest law, G.L. c. 268A, by Mr.
Donaldson. The Commission concluded its inquiry and, on January
26, 1993, voted to find reasonable cause to believe that Mr.
Donaldson had violated G.L. c. 268A.

The Commission and Mr. Donaldson now agree to the following
findings of fact and conclusions of law:

1. Mr. Donaldson served as the Tolland Health Agent from
1985 until 1991. Mr. Donaldson was appointed to this position by
the Tolland Board of Selectmen, who are also the town's board of
health. At the times here relevant, the position of health agent
was a part-time position, which was unpaid except for the
receipt of certain fees, including primarily those described below. Mr.
Donaldson was also a Tolland Selectman and Board of Health member
from 1983 to

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1989. These positions were part-time and only nominally paid. As
the Tolland Health Agent and as a selectman and board of health
member, Mr. Donaldson was a municipal employee as that term is
defined in G.L. c. 268A, s. 1(g).

2. During the times here relevant, Mr. Donaldson was self-
employed as a real estate broker and was the owner, with his
wife, of the real estate firm Misty Mountain Realty (Misty
Mountain), which was then located in Tolland. During the period
here relevant, Misty Mountain was the only real estate firm
located in Tolland and did business in Tolland and neighboring
communities.

3. As Tolland Health Agent, Mr. Donaldson's primary duty
was to witness percolation tests (perc tests) of land to
determine whether the land was suitable for the installation of a
subsurface sewage disposal system (septic system) and was thus
buildable. As the town's perc test witness, Mr. Donaldson's role
was that of an observer to make sure that the right property was
tested and that the engineer or sanitarian doing the test
conducted it properly according to Title V (the State Sanitary
Code) and local ordinances. For each perc test he witnessed, Mr.
Donaldson was paid a fee by the landowner or other person having
the test conducted. The witness fee ranged from approximately $50
to approximately $100 during the time that Mr. Donaldson was
health agent. This fee was paid to Mr. Donaldson regardless of
the outcome of the perc test.

4. As a real estate broker, it is Mr. Donaldson's
established practice to advise any potential client seeking to
list land in Tolland or elsewhere for sale with Misty Mountain
that a successful perc test of the land is required before he can
represent it to potential buyers as buildable land [1]. While he
was the Tolland Health Agent, Mr. Donaldson routinely gave such
advice to potential clients and then witnessed perc tests of the
land as health agent. Mr. Donaldson would then, if the tests were
successful, accept the listing of many of these properties with
Misty Mountain. In addition, from time to time, Mr. Donaldson
would accept a listing of land with Misty Mountain prior to the
land being perc tested, and would then offer the land for sale
subject to it passing a perc test. Subsequently, Mr. Donaldson
would, as health agent, witness the perc testing of the land.

5. Accordingly, while he was the Tolland Health Agent, Mr.
Donaldson engaged in a repeated pattern or practice of witnessing
perc tests on land that was already listed for sale with his
private real estate firm and of witnessing perc tests on land
with the knowledge or expectation that the land would be
subsequently listed for sale with his firm if it perced
successfully [2]. In many cases, Mr. Donaldson's firm brokered
the sale of the land in question and received a broker's
commission [3]. Thus, for example: [4]

(a) in or about June 1987, Mr. Donaldson as health agent
witnessed successful perc tests on four Tolland lots (10
Colebrook River Rd., EO-19, TS-20 and TT-39) that were
already listed with Misty Mountain (Misty Mountain brokered
the sales of the first three lots in 1987 and the sale of
the fourth lot in 1988); [5]

(b) in or about June 1987, Mr. Donaldson as health agent
witnessed successful perc tests on five Tolland lots (OPT-4,
TF-5, ON-28, TT-30 and TT-32) and then, in July 1987, Misty
Mountain entered into listing agreements for those lots
(Misty Mountain brokered the sales of these five lots in
1987);

(c) on or about August 10, 1987, Mr. Donaldson as health
agent witnessed successful perc tests on a Tolland lot (8
Burt Hill Rd.) and, on or about August 28, 1987, Misty
Mountain entered into a listing agreement for the property
(Misty Mountain brokered the sale of this lot in 1988);

(d) in or about June 1988, Mr. Donaldson as health agent
witnessed successful perc tests on lot SV-17 in Tolland,
which was already listed for sale with Misty Mountain (Misty
Mountain brokered the sale of this lot in 1988); and

(e) in or about July 1989, Mr. Donaldson as health agent
witnessed successful perc tests on as many as five lots on
Clubhouse Road in Tolland owned by Nick Bonadies (Bonadies)
that Bonadies either had already listed for sale with Misty
Mountain or as to which Mr. Donaldson and Bonadies had an
understanding that they would be listed for sale with Misty
Mountain (Misty Mountain brokered the sales of two of these
lots in 1989) [6].

6. Except as otherwise permitted by that section, G.L. c.
268A, s. 19, in relevant part, prohibits a municipal employee
from participating, as such, in a particular matter in which he
or a business organization in which he is serving as an officer,
director or employee has a financial interest. None of the
exceptions to G.L. c. 268A, s. 19 applies in this case.

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7. The perc tests of the land referred to above were
particular matters within the meaning of G.L. c. 268A [7]. Mr.
Donaldson had a financial interest within the meaning of G.L. c.
268A [8] in the perc tests of land that was either listed for
sale with Misty Mountain or which he had an understanding or a
reasonable expectation would be listed for sale with Misty
Mountain, if it perced successfully, in that Mr. Donaldson stood
to sell and receive commissions on land which passed a perc test.
Mr. Donaldson was aware of this financial interest at the time he
witnessed the perc tests of the land referred to above. While Mr.
Donaldson did not conduct the perc tests himself, his witnessing
of those perc tests as the official representative of the town
board of health was personal and substantial participation in the
tests for the purposes of G.L. c. 268A.

8. Thus, by witnessing, as the Tolland Health Agent, perc
tests of land which was already listed for sale with Misty
Mountain or which he had an understanding or expectation would be
so listed if it perced successfully, as described above, Mr.
Donaldson participated officially, as health agent, in particular
matters in which he had a financial interest. In so doing, Mr.
Donaldson violated s. 19.

In view of the foregoing violation of G.L. c. 268A, s. 19 by
Mr. Donaldson, the Commission has determined that the public
interest would be served by the disposition of this matter
without further enforcement proceedings, on the basis of the
following terms and conditions agreed to by Mr. Donaldson:

(1) Mr. Donaldson will pay to the Commission the sum of two
thousand dollars ($2,000.00) as a civil penalty for
violating G.L. c. 268A, s. 19;

(2) Mr. Donaldson will pay to the Commission the sum of one
thousand dollars ($1,000.00) as restitution of the perc test
witness fees he received in violation of G.L. c. 268A, s.
19; and

(3) Mr. Donaldson waives all rights to contest the findings
of fact, conclusions of law, and terms and conditions
contained in this Agreement in this or any related
administrative or judicial proceeding to which the
Commission is or may be a party.


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[1] It is also Mr. Donaldson's practice to advise persons
seeking to buy land through Misty Mountain to have the land perc
tested as a condition of purchase.

[2] Not all of the perc tests witnessed by Mr. Donaldson on
land listed for sale with Misty Mountain, or expected to be
listed for sale with Misty Mountain if the land perced
successfully, were successful.

[3] Generally, the commission received by Misty Mountain was
10% of the selling price.

[4] This Disposition Agreement imposes sanctions only with
regard to Mr. Donaldson's actions in witnessing perc tests since
1987, as the Commission's statute of limitations, 930 CMR
1.02(10)(f), bars the Commission's sanctioning of violations
which occurred more than six years ago.

[5] No broker's commission was received by Misty Mountain
for the sale of lot EO-19, which was purchased by Mr. Donaldson
and his wife.

[6] As the Tolland Health Agent, Mr. Donaldson received
approximately $1,000 in fees for witnessing the perc tests on the
lots referred to in paragraph 5.

[7] Section 1(k) of G.L. c. 268A, in pertinent part, defines
"particular matter" to include any ". . . application, submission
. . . decision, determination, finding . . ."

[8] "Financial interest" means any economic interest of a
particular individual that is not shared with a substantial
segment of the population of the municipality. See Graham v.
McGrail, 370 Mass. 133 N.E. 2d 888 (1976). This definition has
embraced private interests, no matter how small, which are
direct, immediate or reasonably foreseeable. See EC-COI-84-98.
The interest can be affected in either a positive or negative
way. See EC-COI-84-96.