Office of Disciplinary Counsel v. Krosby

78 Pa. D. & C.4th 409
CourtSupreme Court of Pennsylvania
DecidedJuly 12, 2005
DocketDisciplinary Board Docket no. 125 D.B. 2003
StatusPublished

This text of 78 Pa. D. & C.4th 409 (Office of Disciplinary Counsel v. Krosby) is published on Counsel Stack Legal Research, covering Supreme Court of Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Office of Disciplinary Counsel v. Krosby, 78 Pa. D. & C.4th 409 (Pa. 2005).

Opinion

To the Honorable Chief Justice and Justices of the Supreme Court of Pennsylvania:

RASPANTI, Member,

Pursuant to Rule 208(d)(2)(iii) of the Pennsylvania Rules of Disciplinary Enforcement, the Disciplinary Board of the Supreme Court of Pennsylvania herewith submits its findings and recommendations to your honorable court with respect to the above-captioned petition for discipline.

I. HISTORY OF PROCEEDINGS

On September 9, 2003, Office of Disciplinary Counsel filed a petition for discipline against respondent, Mr. Erling Rolf Krosby. The petition charged respondent with alleged misconduct in connection with court proceedings in Texas, which conduct allegedly violated the Texas Disciplinary Rules of Professional Conduct. Respondent filed an answer to petition for discipline on November 24, 2003.

A pre-hearing conference was held on March 15, 2004, in which respondent participated via telephone [411]*411conference call. Respondent agreed to certain proposed joint stipulations; however, respondent never signed the joint stipulations of law and fact which memorialized the agreements reached during the pre-hearing conference.

A disciplinary hearing was held on April 27, 2004, before Hearing Committee 1.13, comprised of Chair James J. Zwolak, Esquire, and Members Douglas E. Ress, Esquire and Edward R. Paul, Esquire. Respondent did not appear at this hearing. The committee took judicial notice of respondent’s prior agreement to the stipulations presented at the hearing. Respondent’s exhibits R-l through R-4 were admitted into evidence.

Following the submission of briefs by the parties, the Hearing Committee filed a report on September 16,2004, finding that respondent violated the Texas Disciplinary Rules of Professional Conduct 3.01, 3.02, 3.03(a)(1), 3.04(d), and 5.05(a), and recommending that respondent be suspended for a period of five years.

Respondent filed a brief on exceptions, and although he had not appeared at the underlying hearing, requested oral argument on October 5,2004. Petitioner filed a brief opposing exceptions on October 25, 2004.

Extended oral argument was held on January 10,2005, before a three-member panel of the Disciplinary Board chaired by Marc S. Raspanti, Esquire, with Members Laurence H. Brown, Esquire and Min S. Suh, Esquire. Respondent represented himself at the oral argument held in Philadelphia.

This matter was adjudicated by the Disciplinary Board at the meeting of January 19, 2005.

[412]*412II. FINDINGS OF FACT

The board makes the following findings of fact:

(1) Petitioner, whose principal office is located at Suite 1400,200 North Third Street, Harrisburg Pennsylvania, is invested, pursuant to Rule 207 of the Pennsylvania Rules of Disciplinary Enforcement, with the power and duty to investigate all matters involving alleged misconduct of an attorney admitted to practice law in the Commonwealth of Pennsylvania and to prosecute all disciplinary proceedings brought in accordance with the various provisions of said rules.

(2) Respondent, Erling Rolf Krosby, was born in 1925 and was admitted to practice law in the Commonwealth in 1990. He does not now, nor has he ever maintained an office for the practice of law in the Commonwealth of Pennsylvania. His attorney registration address is 2243 Foreland. Drive, Houston, Texas 77077. Respondent is subject to the disciplinary jurisdiction of the Disciplinary Board of the Supreme Court.

(3) Respondent has no prior record of discipline.

(4) Although respondent’s address is in Texas, he is not admitted to practice law in the State of Texas other than through a pro hac vice motion.

Procedural Background

(5) On August 14, 1991, Burton Securities S.A. filed a voluntary Chapter 11 Bankruptcy petition in the United States Bankruptcy Court of the Southern District of Texas, Corpus Christi Division. The Honorable Richard S. Schmidt was assigned to preside over the Chapter 11 reorganization.

[413]*413(6) Among Burton Securities’ scheduled creditors were Kleberg & Head P.C., a law firm that represented Burton Securities in an admiralty action, for its unpaid legal fees; Tor Husjord A/S, the manager of a sailing vessel owned by Burton Securities, for its unpaid management fees; Memories Inc.; Marcus Byrd; and Majestic Ltd.

(7) Robert W. Woolsey, Esquire, represented Tor Husjord Shipping A/S, Memories Inc., Marcus Byrd, and Majestic Ltd., in the Chapter 11 case through 1995. Respondent assisted Mr. Woolsey in the Chapter 11 proceedings, attending hearings and drafting documents for Mr. Woolsey.

(8) Kleberg proposed a Reorganization Plan on behalf of all creditors. The creditors voted to accept the Plan and Judge Schmidt approved the Plan on December 1,1992.

(9) The Plan provided that Tor Husjord Shipping A/S was a Tier 3 and partially Tier 4 creditor, receiving partial payment of its proof of claim after Tier 1 and Tier 2 creditors. Tor Husjord did not appeal this order of payment set forth in the confirmed Plan.

(10) The Plan included a liquidation trust agreement that provided for the appointment of Harrell Z. Browning, Esquire as the liquidating trustee.

(11) Trustee Browning’s duties were to liquidate the assets of the estate. The liquidation trust agreement provided that Trustee Browning was liable for his willful misconduct, bad faith or gross negligence, but exempted Trustee Browning from liability for breach of contract in the performance of his duties and his discretionary acts.

(12) The liquidation trust agreement provided that Kleberg could remove Trustee Browning with or without cause, at any time. On or before March 17,1994, Mr. [414]*414Woolsey requested that Kleberg remove Trustee Browning. Kleberg refused to remove Trustee Browning. Mr. Woolsey took no further direct action to remove Trustee Browning.

(13) One of Burton Securities’ primary assets was a gaming/cruise ship (the vessel). After two unsuccessful efforts to sell the vessel, Trustee Browning filed his third motion to sell the vessel on December 20, 1994.

(14) After all the creditors and their counsel, including respondent, received notice of the proposed sale, Judge Schmidt approved the motion to sell the vessel.

(15) Respondent met privately with Trustee Browning concerning distribution of the proceeds of the sale of the vessel. Respondent argued that Tor Husjord Shipping’s secured claim had priority over the payment scheme set forth in the confirmed Reorganization Plan. After Trustee Browning disagreed with respondent’s interpretation of the Plan, respondent threatened to sue Trustee Browning. Trustee Browning informed respondent that he would seek clarification of the distribution from the bankruptcy court.

(16) On June 2, 1995, Trustee Browning filed a motion for approval of proposed distribution to creditors and declaration of the relative rights of the parties participating in the distribution. On July 12,1995, the bankruptcy court ruled that the confirmed plan of reorganization set forth the priorities for distribution and that the liquidating trustee make distribution according to the priorities provided in the Plan.

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Related

Office of Disciplinary Counsel v. Grigsby
425 A.2d 730 (Supreme Court of Pennsylvania, 1981)
Office of Disciplinary Counsel v. Keller
506 A.2d 872 (Supreme Court of Pennsylvania, 1986)
Office of Disciplinary Counsel v. Price
732 A.2d 599 (Supreme Court of Pennsylvania, 1999)

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78 Pa. D. & C.4th 409, Counsel Stack Legal Research, https://law.counselstack.com/opinion/office-of-disciplinary-counsel-v-krosby-pa-2005.