West Bay district's attorney resigns

**Increasingly under attack, William Esselstein says job has become a burden.

By RENEE DEAL

Saying that representing the West Bay Sanitary District has become "an unwelcome burden" because of "callous, insulting, antagonistic, even vicious attitudes exhibited by certain persons," William Esselstein resigned last week as the district's counsel.
Mr. Esselstein's resignation comes at a time when the district is being threatened with litigation over the hiring of its manager, Carl Schrader, who was on the district board at the time of his September 1997 appointment.
The Menlo Park attorney, who has represented the district for more than 20 years, is also under scrutiny by a board-appointed investigator -- a retired judge asked to determine whether Mr. Esselstein should have investigated two employees' separate allegations that the district's manager from 1991 to 1996 was mishandling district funds.
Board president David Knight said retired Judge Allison Rouse's report is likely to be presented at the April 13 board meeting.
As a result of an investigation initiated by the San Mateo County District Attorney's Office long after the employees made their suspicions known to Mr. Esselstein, the former manager, Charles "Sandy" Thomas, was charged last year on 36 felony counts of stealing and other crimes against the district.
In recent months, Mr. Esselstein has come under increasing fire by board member John Carcione, who during the April 1 board meeting accused the attorney of a "cover-up" involving the 1996 legal settlement with a former employee. (See separate story, this page.) Since his election to the board in November, Mr. Carcione has criticized Mr. Esselstein's handling of a number of matters, including the district's civil lawsuit against Mr. Thomas, and the manner in which Mr. Esselstein compiled board meeting minutes.
"Clouded" legal advice

In his April 1 letter of resignation, Mr. Esselstein noted that since last December, his integrity and competence have been called into question in the handling of matters he must advise the board on. "As a result, the legal advice I am expected to provide the board may appear to be clouded by the perception that my firm and I may have a personal stake in the outcome and that a conflict of interest might exist," he wrote.

He said he believes "a strategy is being employed to continue this pattern as long as I remain district counsel."

Mr. Knight last week praised Mr. Esselstein's service to the district, saying that "he has given wise and good counsel" to the district, and that he has been "extremely diligent" in keeping up with changing laws affecting sanitary districts.

Saying that "several of us on the board" will miss Mr. Esselstein's counsel, Mr. Knight added that "life has been made extremely difficult for him."

"As an attorney, he's a target, but cannot respond to the charges," Mr. Knight said. "So he's really been a victim of, I think, a needless attack."

Mr. Carcione said Mr. Esselstein's resignation is "a step in the right direction." Citing what he charges is a "cover-up" of the district's settlement with former employee Maxine Harrington, he said: "The fact is, if you are going to do the public's business in secret, you are going to feel unwelcome when that is discovered."

Mr. Esselstein could not be reached for comment.

What's next

The board held a special meeting April 4, and voted to ask attorney Marc Zafferano to act as interim counsel until a permanent counsel is hired, according to Mr. Knight. The district will advertise for the position, and also will check with other special districts in the area to explore options, he said.

The board also will ask Mr. Zafferano to represent the district on a pressing matter that may result in a lawsuit: a "ratepayer's demand for action" filed by Menlo Park resident Ronald Shepherd. The action, filed March 23, demands that district manager Carl Schrader be fired and forced to return all money paid to him since his hiring last September.

Mr. Shepherd and his attorney, Tony Tanke, maintain that Mr. Schrader's hiring while he was still a member of the board was illegal. Mr. Tanke said he will take legal action against the district if the board does not fire Mr. Schrader and begin an extensive search for his replacement. The "demand for action" gives the board until April 12 to comply.

The "demand" cites government code section 1090, which states that district officers "shall not be financially interested in any contract made ... by any board or body of which they are members."

Attorney David Byers of Burlingame, who said he represents Mr. Schrader, attended the April 1 meeting at which Mr. Tanke reiterated his position.

Mr. Byers said later he is familiar with government code section 1090, but maintained that his client "didn't do anything wrong. He has no liability" under section 1090.