Attorney Must Reveal Details of Inheritances From Clients : Courts: James Gunderson and law partner daughter also fined for refusal to answer questions about $3.5-million bequest from Leisure World man. The retiree’s survivors are suing to recover it.

A Superior Court judge on Wednesday dealt a setback to Laguna Hills lawyer James D. Gunderson, ruling that the attorney must disclose details of inheritances he received under the terms of wills and trusts he prepared for elderly Leisure World clients.

Judge James L. Smith also ordered Gunderson and his daughter and law partner, Linda Gunderson, to pay sanctions of $1,000 each for refusing to answer questions about a $3.5-million bequest that James Gunderson received in February, 1992, from a 98-year-old Leisure World man, Merrill A. Miller.

Gunderson had sought to squelch disclosure about the millions of dollars in cash, stock and real estate he has received over the years from clients’ estates.

But questions of his inheritances were raised in a court action filed by Miller’s relatives who are seeking to recover the $3.5-million bequest. The relatives claim that Gunderson exercised undue influence to secure the largest single inheritance from Miller’s $18-million estate. They said in court papers that Miller was both blind and bedridden when Gunderson arranged for him to sign his last will only weeks before his death.

In sworn depositions for the case, Gunderson said his inheritances from other clients were not relevant to the Miller case and that they were protected by his clients’ rights to privacy.

Linda Gunderson, who served as trustee of Miller’s estate, similarly refused to answer questions.

In a decision released Wednesday, Smith said the Gundersons should answer, with two exceptions, questions about previous inheritances. The judge also ruled that James Gunderson must produce documents requested by attorneys for Miller’s relatives.

The attorneys--John H. Westover of Phoenix and his cousin, Harry Westover of Newport Beach--want Gunderson to produce 37 clients’ files to show that he had received numerous gifts from the estates of other clients. They say the documents and Gunderson’s answers would show a pattern “inconsistent with Gunderson’s defense that he was a friend of” Miller.

The Times disclosed last November that Gunderson had received sizable gifts from his clients despite a state Supreme Court ruling that anything more than a “modest” bequest to an individual’s attorney raises questions of impropriety. Gunderson has repeatedly denied any wrongdoing.

Since the disclosures, Gunderson’s law practice--which is located just outside the gates of the Laguna Hills retirement community of 22,000 residents--has been under investigation by the Orange County Sheriff’s Department, the State Bar of California and the Orange County Bar Assn.

Along with the $3.5-million bequest from Miller, Gunderson received:

* AT&T; stock worth at least $225,000 from Emerald Mary Sully, who was diagnosed with senile dementia five months before Gunderson drafted a new will, making himself the major beneficiary of her estate.

* Virtually all of Martin Fisher’s $427,000 estate, including a 316-acre farm in Fresno County, a Leisure World condominium valued at $67,000, and $75,000 in cash savings which had been deposited in an S&L; founded by Gunderson across the street from Leisure World. The will Gunderson prepared for Fisher bequeathed only $2,000 to Fisher’s sole surviving relative, Richard B. Fisher, a brother who lived in Ft. Worth.

Documents obtained by The Times also showed that Gunderson frequently had sole and absolute authority over estates valued in the hundreds of thousands of dollars. He frequently elected to dole out large sums of money to parties with whom he was doing business, to his law partners for legal services to the estates in question, to his favorite charities and to his alma mater.

Last week, The Times reported that Gunderson’s insurance carrier agreed pay a substantial sum--between $150,000 to $425,000--to settle a court action involving a Leisure World widow whose relatives claimed that Gunderson caused her to lose more than $500,000.

Gunderson’s practices spurred state lawmakers to introduce legislation that would restrict lawyers from making themselves beneficiaries of their clients’ estates.

Aside from the proposed legislation, the State Bar is proposing to add to its rules of professional conduct a stipulation forbidding lawyers from preparing wills or trusts that bequeath them gifts.