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Embattled Ex-Judge Not Done Hearing Foreclosure Cases

Although Dorchester County has a new master-in-equity judge, the former longtime judge who resigned over allegations he mishandled foreclosure cases says he expects to continue hearing such cases as a “special referee.”

“I’ll probably still do some special referee cases,” Patrick Watts told The Nerve last week, noting that private attorneys can be assigned as temporary judges in foreclosure cases when there are conflicts of interest with sitting judges.

Asked how often he expected that would happen, Watts, a private-practice attorney in Summerville, replied: “I have no idea. Conflicts are rare.”

Watts confirmed that as a special referee, he is handling a dozen foreclosures listed on his law firm’s website (http://patrickrwatts.com) for an auction sale on July 5.

The Nerve first reported in April that Watts had been appointed as a special referee in at least 48 foreclosure cases in Dorchester County, even though he had been off the bench for three months. As of this month, he had been assigned to about 55 cases, according to Dorchester County clerk of court records.

Watts declined to address concerns by others that he should not be allowed to continue hearing foreclosure cases as a special referee, given the controversy surrounding his handling of those types of cases when he was on the bench.

Watts also declined comment on a pending ethics complaint by a Summerville couple questioning why he was allowed to continue hearing their foreclosure case and others after he resigned his judgeship at the end of 2010.

Renee Holoubek, who, along with her husband, Joseph Holoubek, filed a March 25 complaint against Watts, told The Nerve last week that she has not heard anything from the state Office of Disciplinary Counsel, which investigates ethical complaints against lawyers and judges.

“I must say I detest how the system works here: allowing plaintiffs to choose their judges, allowing pleadings to be mailed to the judges’ private addresses, hearings held in his private office, etc.,” Holoubek, a former deputy clerk in the Oklahoma Supreme Court, said in a written response. “It just seems wrong.”

When The Nerve first reported in April on the couple’s complaint (a copy of which was provided to The Nerve then by Renee Holoubek), Holoubek asked that she and her husband not be identified. She said she agreed to be identified for this story because Watts recused himself from their case after The Nerve’s initial story.

“No new judge has been assigned, and my motions remain unanswered,” Holoubek said. “We’re in legal limbo, I guess.”

Watts had been the county’s master-in-equity since 1994 and earned about $68,000 annually in the part-time position. He resigned at the end of 2010 amid allegations that he mishandled foreclosure cases, including one involving another Summerville woman that was decided by the S.C. Supreme Court.

The high court in 2009 ruled that Watts violated Sherry Peterson-Davidson’s constitutional rights by allowing his secretary to conduct a foreclosure hearing involving her home – without any testimony. Watts later signed an order authorizing the foreclosure, though he wasn’t present at the hearing, according to court records.

Peterson-Davidson later filed an ethics complaint against Watts, who received a private slap on the wrist from court officials, according to a court letter provided by Peterson-Davidson to The Nerve.

Masters-in-equity have the authority of circuit court judges but typically hear non-jury civil cases, mainly foreclosures. They are screened by the S.C. Judicial Merit Selection Commission, nominated by their respective county’s legislative delegation, appointed by the governor and confirmed by the Legislature.

However, a loophole in the state law allows those judges to continue serving if there are no nominees after their terms expire, which is what happened in Watts’ case.

Because of a split in the Dorchester delegation over whether to renominate Watts, he continued in his position after his term expired last June 30, becoming the first such judge to serve in “holdover” status, according to Jane Shuler, the chief attorney for the Judicial Merit Selection Commission, a 10-member committee made up mostly of lawmakers.

Watts sought a new six-year term last year but withdrew his candidacy in the fall, throwing the election process into limbo. He resigned his seat at the end of December, though his resignation letter gave no reason.

After his resignation, S.C. Supreme Court Chief Justice Jean Toal assigned Circuit Judge Diane Goodstein of St. George as a temporary master-in-equity for Dorchester County.

In March, Circuit Judge Edgar Dickson of Orangeburg, the chief administrative judge of the 1st Circuit, which covers Dorchester, Orangeburg and Calhoun counties, appointed Watts as a special referee in at least six foreclosure cases, allowing hearings on those cases to be held in Watts’ private law office in Summerville, records show.

Under a state court rule, special referees can set their own pay, unless there is an objection by one of the parties. In those cases, a circuit judge would review the proposed fee.

Rosalyn Frierson, the S.C. Judicial Department’s state court administrator, told The Nerve in a written response last week that she didn’t know if Watts was continuing to hear foreclosure cases as a special referee. She referred The Nerve’s questions to Maite Murphy, who was elected by the Legislature in May as the new Dorchester County master-in-equity.

Murphy, wife of state Rep. Chris Murphy, R-Dorchester and an attorney, declined comment when contacted last week by The Nerve, citing judicial ethics rules.

Because Dorchester County’s population has grown since the last U.S. Census in 2000, Maite Murphy will serve as a full-time master-in-equity, according to Shuler and state Sen. Mike Rose, R-Dorchester.

Under state law, Murphy would be paid 75 percent of a circuit judge’s annual $130,312 salary, or $97,734.

Contacted last week, Rose, an attorney and a vocal critic of Watts, said there was no dissension in the county delegation over Murphy’s nomination, noting that she has served as the county’s chief magistrate and was qualified twice by the Judicial Merit Selection Commission to be a circuit judge.

In the wake of the controversy surrounding Watts, Rose in December prefiled a bill (S. 269) that would ban masters-in-equity whose terms expire from being in “holdover” status. Another bill (S. 270) he introduced would put a 60-day deadline on county legislative delegations to submit names of master-in-equity candidates to the governor.

Neither bill made it out of the Senate Judiciary Committee, chaired by Senate President Pro Tempore Glenn McConnell, R-Charleston, who also chairs the Judicial Merit Selection Commission and appoints half of its members.

“The bills got crowded out by things people considered to be a higher priority,” Rose told The Nerve.

A related third bill (S. 394) filed by Rose, however, had more success this year, passing the Senate in April, though it remained in the House Judiciary Committee at the end of the regular legislative session. Under that bill, governing bodies in counties with populations of at least 130,000 but fewer than 150,000 could decide whether to have full- or part-time masters-in-equity. Their salaries would be set based on whether the position was full- or part-time.

Reach Brundrett at (803) 254-4411 or rick@thenerve.org.

Accountability General Assembly