Settlement  In the Matter of Patrick F. Jordan

Date:	02/04/1983
Organization:	State Ethics Commission
Docket Number:	190

Disposition Agreement

This disposition agreement ("agreement") is entered into between the State Ethics Commission ("Commission") ad Patrick F. Jordan ("Mr. Jordan") pursuant to Section 11 of the Commission's Enforcement Procedures. The parties agree that this agreement constitutes a consented to final order of the Commission enforceable in the Superior Court pursuant to G.L. c. 258B, s.4(d). 

On April 12,1982, the Commission initiated a preliminary inquiry, pursuant to G.L. c. 258B, s.4(a), into possible violations of the Conflict-of-Interest Law, G.L. c. 268A, involving Mr. Jordan, a member of the Stoneham Board of Selectmen. The Commission has concluded that preliminary inquiry and, on December 20,1982, found reasonable cause to believe that Mr. Jordan has violated G.L. c. 268A, s.3. The parties now agree to the following findings of fact and conclusions of law: 

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1. Since May 1977, Mr. Jordan has been a member of the Board of Selectmen for the Town of Stoneham (the "Board") and, as such, at all times material to this agreement was a municipal employee as defined in G.L. c. 268A, s.1(g).

2. As a selectman, Mr. Jordan considered and voted upon applications for approval of site plans filed by owners and developers of property located in Stoneham. 

3. In January 1980, Mr. Jordan asked Simon Zaltman ("Mr. Zaltman"), a real estate developer in Stoneham, if Mr. Zaltman knew where Mr. Jordan might borrow $5,000. Mr. Zaltman arranged for Mr. Jordan to borrow $5,000 on January 29, 1980 from Nicholas Gouliamas ("Mr. Gouliamas"). This loan was payable on demand and at an interest rate of 13% it was personally guaranteed by Mr. Zaltman. 

4. Mr. Jordan made the interest payments due Mr. Gouliamas under the loan for the first 2 1/2 months. Thereafter, from approximately April 1980 until June 1982, Mr. Zaltman made the remaining interest payments owed by Mr. Jordan. On or about June 6, 1982, Mr. Zaltman paid Mr. Gouliamas $5,000 to discharge Mr. Jordan's debt and received thereafter from Mr. and Mrs. Jordan a note evidencing their promise to repay the $5,000 plus interest at the rate of 13% from April 29,1980. No payments of either interest or principal have been made on this note to date. 

5. On December 13,1980, Mr. Zaltman made an unsecured loan of $2,000 to Mr. Jordan, payable on demand and interest-free. To date, Mr. Jordan has made no payments of either principal or interest on this loan. 

6. On October 15,1981, Mr. Zaltman lent Mr. Jordan an additional $2,000 payable on demand and interest-free. This loan was later discharged when Mr. Zaltman withheld $2,000 in commissions owed Mr. Jordan's wife for her work for Mr. Zaltman selling townhouses in the Stoneham condominium development known as Moseley Park. 

7. During the period when Mr. Zaltman was making interest payments to Mr. Gouliamas for Mr. Jordan, discharging Mr. Jordan's $5,000 debt to Mr. Gouliamas, and making loans, interest-free, to Mr. Jordan, Mr. Jordan was a selectman and had official dealings with matters in which Mr. Zaltman had a substantial interest.

a. In August 1980, Mr. Zaltman agreed to sell Moseley Park to another developer for $400,000, conditioned on Mr. Zaltman's ability to secure site plan approval and other permits and authorizations needed from the town. Under this agreement, Mr. Zaltman retained exclusive rights to sell units at the development for a commission of approximately $4,000 per townhouse. 

b. On October 6, 1980, Mr. Jordan voted to approve Mr. Zaltman's site plan for the Moseley Park development which provided for forty-seven townhouses. 

c. On October 21,1980, Mr. Zaltman sold Moseley Park under the August 1980 agreement and took back a $251,000 second mortgage from the purchaser 

d. On April 21, 1981. Mr. Jordan voted to approve Mr. Zaltma's amended site plan for Moseley Park which increased the number of townhouses to be built to fifty. As a result of the approval of the amended site plan, Mr. Zaltman's potential commissions on the project were increased by approximately $12,000.

8. Section 3(b), G.L. c. 268A, provides in pertinent part that a municipal employee, other than as provided by law for the proper discharge of his official duty, shall not directly or indirectly accept, receive or agree to receive anything of substantial value for himself for or because of any official act or acts within his official responsibility performed or to be performed by him. 

9. By receiving from Mr. Zaltman items of substantial value i.e., the guarantee and interest and principal payments on the first loan and the interest-free second and third loans -- Mr. Jordan violated section 3(b) because these items were given to Mr. Jordan in view of his official duties as a member of the Stoneham Board of Selectmen and his responsibilities for approving site plans. As the Commission stated in In the Matter of George A. Michael, Commission Adjudicatory Docket No. 137, Decision and Order, p. 31 (September 28, 1981): 

A public employee need not be impelled to wrongdoing as a result of receiving a gift or gratuity of substantial value, in order for a violation of section 3 to occur. Rather, the gift may simply be a token of gratitude for a well-done job or an attempt to foster goodwill. All that is required to bring section 3 into play is a nexus between the motivation for the gift and the employee's 

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public duties. If this connection exists, the gift is prohibited. To allow otherwise would subject public employees to a host of temptations which would undermine the impartial performance of their duties, and permit multiple remuneration for doing what employees are already obligated to do - a good job. Sound public policy necessitates a flat prohibition since the alternative would present unworkable burdens of proof. It would be nearly impossible to prove the loss of an employee's objectivity or to assign a motivation to his exercise of discretion. in public credibility in government instructions is to be fostered, constraints which are conducive to reasoned, impartial performance of public functions are necessary, and it is in this context that section 3 operates. 

WHEREFORE, 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 representations to which Mr. Jordan has agreed:

1. That he pay the Commission the sum of one thousand dollars ($1,000) forthwith a civil penalty for violating G.L. c. 288A, s.3(b), because he received interest and principal payments and interest-free loans for or because of his acts ad responsibilities as a member of the Stoneham Board of Selectmen;  

2. That he pay the Commission the sum of nine hundred dollars ($900) as a forfeiture of the economic advantage he gained -- that is, the interest foregone by Mr. Zaltman-- as a result of this violation of G.L. c. 268A, s.3(b); 

3. That he refrain from participation in any matters in which Mr. Zaltman has a financial interest coming before the Stoneham Board of Selectmen while Mr. Jordan is a member until the outstanding debt to Mr. Zaltman is repaid; and 

4. That he waive all rights to contest the findings of fact, conclusions of law and conditions contained in this agreement in this or any related administrative or judicial proceedings.

 End of Decision