2 Lawyers Admit Disguising Gifts to Campaign : Politics: $3,000 in contributions is funneled to Huntington Beach’s city attorney despite a $300 limit. The attorneys had worked for the city in the 1980s.

Two Irvine lawyers admitted Thursday that they illegally disguised their contributions to the 1986 campaign of Huntington Beach City Atty. Gail C. Hutton and agreed to pay penalties of $15,000 each, Deputy Dist. Atty. Craig McKinnon said.

Lawyers Wesley L. Davis and Peter J. DiGrazia were charged in 1990 with jointly funneling about $3,000 in donations to Hutton’s campaign, despite a Huntington Beach city law that allows just $300 per contributor. According to court documents, names of some employees of the Davis-DiGrazia law firm were used as disguises for the excess donations.

Davis and DiGrazia had been hired by Hutton to handle flood cases against the city in the 1980s.

Hutton, in an interview, said that Davis and DiGrazia had been hired because they specialize in such cases and that the campaign donations had no bearing on their employment.

Hutton was not accused of any wrongdoing by the district attorney’s office.

“I reported all the donations to my campaign just as I had received them,” she said.

The case against Davis and DiGrazia was one of the rare times in county politics that criminal charges were filed for alleged disguising of campaign donations. The case was postponed many times in the year and half since it was filed, and it ended without ever going to a jury trial.

The settlement came after the case--once a criminal allegation--was changed this week to a civil suit. McKinnon said the civil suit was settled by joint agreement in Orange County Superior Court here late Thursday afternoon.

Neither Davis nor DiGrazia could be reached for comment about the settlement.

Previously, however, Davis had said he and DiGrazia believed that they had “fulfilled all the intent of the law and disclosed the donations properly.”

But McKinnon said Thursday that the two “did admit to the allegations in the civil suit.”

McKinnon said the charges in the civil suit were the same as in the criminal complaint filed against Davis and DiGrazia.

Court documents filed with the criminal complaint against the two lawyers said an investigator for the county district attorney’s office found that Davis-DiGrazia employees had given donations to the Hutton campaign after being told that they would be reimbursed.

A report filed by the investigator, Douglas S. Miller, included an account of his interview with Marianne Westerdoll, a secretary for the law firm.

Miller’s report said: “I asked her (Westerdoll) if she made a contribution to the election campaign of Gail Hutton, and she became very nervous. . . . Westerdoll went on to say that sometime in 1986 there was a meeting held of all employees at the law firm of Davis & DiGrazia.

“She said the meeting was called by both Davis and DiGrazia, and they told the employees that Gail Hutton was running for office again in Huntington Beach, and that they wanted to make a contribution to her campaign. . . . They told the employees that the employee would write a check to the campaign from the employee’s personal checking account, and that Davis and DiGrazia would reimburse the employee for the contribution.”

McKinnon on Thursday said the successful prosecution of the case underscores the legal danger of disguising campaign donations.

“We hope it serves to deter other people” from making illegal campaign donations, McKinnon added.