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Complaint of Alphonse Mourad Asainst Harold B. Murphy. Donald Farrell. andHanifv &. Kins
Now comes Alphonse Mourad, founder, officer stockholder and creditor in the Debtor, V&M Management, Inc., U.S. Bankruptcy Court, C.A. No. 96-10123-CJK, and writes this complaint against Harold B. Murphy, Donald Farrell, and Hanify & King, V&M Management's counsel, on the grounds that said purposely failed to benefit the Debtor, the Debtor's estate or the creditors interests. Furthermore, Hanify & King refused to appeal the Court's April 1,1996 order appointing a Trustee, thus leaving the Mourad family and V&M's creditors to hang in the wind, and then drafted a notice of appeal for Alphonse Mourad to sign, file, and prosecute when the non-lawyer (Mourad) had no standing to represent the interests of the corporate debtor, V&M Management. Hanify & King's representation fell far below acceptable standards ofnonnegligent advocacy, much less the vigorous degree of advocacy ethically required of counsel, particularly in a case involving many public entities, and with clear political features involving a debtor battling the BRA, DOR, and The City of Boston. In further support, Alphonse Mourad states the/allowing:
The L&N and Nicosia Issue of Fraud. Perjury and Forgery:
1. On February 8, 1996, experienced bankruptcy attorney, Harold Murphy and his firm, Hanify & King, filed an application to be employed as successor counsel to the Debtor, and to authorize payment of a $25,000 retainer. The Court allowed the application. Within days of Harold Murphy's employment, Alphonse Mourad, Attorney Frank Kirby and V&M Attorney, Victor Aronow sat down with Murphy and Attorney Donald Farrell and explained the history leading to the bankruptcy filing, and the perjury, fraud and forgery committed on January 5, 1996, when Attorney Roger Lehrberg submitted a March 29, 1985 note for $50,000 in the Suffolk State
Court Action. The fraudulent, forged and perjured March 29, 1985 Note for $50,000 filed by L&N, Nicosia, and Attorney's Roger Lehrberg and John Rosenberg claimed to have a 24% interest rate. This is not true. The authentic and original Note bore an 18% interest rate, and not a 24% interest rate. Attorney Kirby had prepared an adversary complaint. No 96-1040, that was pending and sought disallowance of the Notes assigned to Moriarty and Nicosia. Mourad, Kirby and Aronow urged Murphy to pursue the adversary proceeding.
2. On February 29, 1996, Harold Murphy's assistant, Eddirland Duncan, ofHanify & King, prepared a Memorandum for Murphy. The Memorandum discussed the March 29, 1985 $50,000 note with a 24% interest rate, its forgery or altercation, and stated that the original 18% March 29, 1985 note for $50,000 was used by Attorney Lehrberg as the basis in a 1986 Boston Housing Court case, C.A. No. 21912, and that the 24% note was never mentioned in that suit (see Exh. "A", Duncan Memorandum).
3. Michael Altman, Esq. of Rubin & Rudman, the attorney representing V&M in V&M and Mourad v. L&N & Nicosia in the Suffolk Superior Court, C.A. No. 96-003 6D, advised Murphy to retain a hand-writing expert to examine the March 29, 1985 24% Note to verify its authenticity (also see Exh. "A").
4. In this bankruptcy case. Murphy failed to use any of the research and information presented to him by his assistant, Eddirland Duncan, failed to acknowledge the information given to him by Attorneys Aronow and Kirby, failed to obtain a hand-writing expert to determine the authenticity of the note, as was advised to him by Attorney Altman, and failed to bring forward the adversary complaint.
5. In a May 27, 1997 sworn affidavit of Ronald H. Rice, a certified hand-writing forensics examiner, see Exh. "B", Mr. Rice concludes that there are stroke dissimilarities between
Mourad's signature on the 24% March 29, 1985 Note, and the known Mourad signatures on the other notes.
6. Had Harold Murphy taken action and presented the true facts to the Bankruptcy Court concerning the actions taken by L&N, Mario Nicosia, and Attorney's Lehrberg and Rosenberg, the Debtor, V&M, would not have remained in bankruptcy, for it was the foreclosure of a bogus note by L&N and Nicosia that precipitated the filing of V&M's bankruptcy to seek protection from said foreclosure.
7. Hanify & King's representation of the Debtor brought no benefit to the V&M estate.
Murphy's Failure To Refute The BRA Motion For A Trustee. To Challenge Examiner Braunstein's Report. Or Object To And Appeal The Appointment Of The Trustee:
8. Harold Murphy failed to challenge Examiner Braunstein's conclusion that Mourad took $923,000 in 1995. He also failed to object to the Court refusal to allow Examiner Braunstein to finish his investigation.
9. In the Court's April 1, 1996 findings, the Court specifically finds that "Mr. Mourad" took or owed the advances or loans at issue. The Court repeatedly says "Mr. Mourad" took the funds; that Mourad took $923,000 in 1995 advances, and that the taking of advances when the debtor was losing money constitutes gross mismanagement under sec. 1104(a)(l). Also, the Court found that Mourad had mismanaged V&M during the years of 1983 and 1984 when in fact, Mourad did not manage the property at that time. Abrams Management and State Street Management managed the property from 1982-1987 and were responsible for any losses accumulated during that time period. Murphy failed to correct, or object to these findings, in that Mourad did not manage V&M during this 1983-1984 period of mismanagement, and the statue of
limitations had expired for any inquiry into this period, much less judicial reliance to support a Trustee appointment.
10. The Court's finding that Alphonse Mourad was guilty of gross mismanagement,' and the Court's appointment of a Trustee, were appealable issues that Hanify & King had an obligation to appeal or secure other counsel to appeal. Hanify & King failed to advise Mourad to retain new counsel to appeal. Council must take all reasonable steps to ensure that a client's rights are properly protected, and the proper and timely filing of a notice of appeal within ten days of the Court's April 1, 1996 order was a required action when Hanify & King refused to appeal because they did not want to offend Judge Kenner who appointed the firm and its partners to lucrative Trusteeships. Hanify & King should have filed the appeal (to timely protest V&M's rights), then sought permission to withdraw, and not done so until successor counsel was retained.
11. The Trustee, Stephen Gray of the Recovery Group, has devalued the property, and he and his attorney, Paul Moore ofChoate, Hall & Stewart, now claim that the 276 unit complex in the City of Boston is only worth $100,000. It is clear and obvious that the Debtor, the estate, and creditor's interests are now in jeopardy because of the actions deliberately not taken by Harold Murphy and by the sinister actions intentionally taken by the Trustee, Stephen Gray.
12. Alphonse Mourad absolutely did not take $923,000 from V&M Management, Inc. After having reviewed the V&M Management, Inc. federal corporate income tax return for the
' Mourad did not manage V&M in 1983-1984, when V&M lost money. Abrams and State Street Management did. These losses occurred over 12 and 13 years before the 1996 bankruptcy filing, and are beyond any limitations period such that the BRA'S use of such stale information and the Court's reliance upon them were wrong. In the Court's February 21,1997 ruling granting Winter-Hill Federal Savings Bank Motion For Summary Judgment on Count 2, the Court relied upon the Bank's limitations defense. Also, the Examiner's statement that Mourad took $923,000 in advances in 1995 is wrong; only $63,831 was advanced to Mourad as a loan.
4
year ended 12/31/95, Certified Accountant Steven Slavin states in a May 9, 1997 letter, see Exh. "C," that the "distributions to shareholders (Mourad) was only $63,831 in 1995."
13. Harold Murphy did not object to the Court's erroneous findings and conclusions, and failed to preserve Mourad's right to an appeal by not doing so. Also, after the Trustee was appointed, he refused to file a Motion For Reconsideration to the appointment of a Trustee, as was requested by the Debtor's President.
14. Attorney Murphy failed to represent V&M Management zealously, in violation of DR 7-101(A)(1), and failed to represent the client (V&M) within the bounds of the law, in violation ofDR 7-102. Hanify & King failed to refute and dispute the factual and legal basis for the BRA Motion For the Appointment of a Trustee, failed to litigate the issues addressed in Mourad's Affidavit, failed to obtain discovery against the three moving governmental entities, failed to litigate the issues addressed in Duncan's February 29, 1996 Memorandum, failed to object to the introduction of stale (1983-1984) evidence at the April 1, 1996 hearing on the Motion to appoint a Trustee, and failed to object to Attorney Saul Schapiro, who had submitted an Affidavit, in support of the BRA Motion For the Appointment of a Trustee, and spoke on behalf of the three governmental moving parties (BRA, DOR, City of Boston) as their lead counsel at the April 1, 1996 hearing while simultaneously testifying as a witness in the same case. Here, BRA attorney Saul Schapiro breached this most basic of evidentiary and ethical rules (DR 5-101(B), DR 5-102). Schapiro should not have simultaneously represented the governmental entities while testifying, Borman v. Borman. 378 Mass. 775, 393 N.E.2d 847 (1979), and Harold Murphy absolutely made no objection to Schapiro's appearance as a witness, as well as his tainting statements.
15. Murphy had Attorney Don Farrell of Hanify & King draft a Notice of Appeal for Mourad to sign and file, see Exh "D". Mourad was not advised that he could not sign and prosecute an appeal, or that only a licensed attorney could represent a corporation, or that Mourad did not have standing to appeal because Mourad was not a party opposing the Motion For Appointment of a Trustee, or that Mourad himself did not personally oppose the Appointment of a Trustee. Mourad testified against and opposed the Appointment of a Trustee at the April 1, 1996 hearing. Why did Harold Murphy have Attorney Don Farrell draft an appeal for Mourad to sign knowing that Mourad lacked standing? It was not until after Mourad timely prosecuted and filed his statement of issues. Appendix and 44 page brief with the U.S. District Court that three Governmental entities jointly moved, on August 5, 1996, to dismiss Mourad's appeal on the alleged ground that Mourad lacked standing.
16. Harold Murphy has violated the DR3-101(A) of the Code of Ethics for lawyers in Massachusetts2, in that it states: a lawyer should not aid a non-lawyer in the unauthorized practice of law.
17. Hanify & King remained in the bankruptcy case as counsel for V&M Management, Inc. until October 10, 1996- when Attorney Leonard Krulewhich called and faxed Murphy a letter, see Exh."E," asking Murphy to assist in protecting Mourad's appeal or substituting V&M as the party.
18. Rather than help. Murphy, Farrell and Hanify & King filed a Motion to Withdraw on the same- October 10, 1996 date, Exh. "F," and the Court allowed that Motion on the same day, without an opportunity for V&M or anyone to file an opposition, without an opportunity for V&M to secure successor counsel, and without further explanation of its actions by Murphy,
2 Attorney Murphy refused to take an appeal from the decision to appoint a Trustee; instead, he recommended that Mourad take the appeal.
Farrell and Hanify & King. Harold Murphy and Donald Farrell has violated sec. 2-110(A)(2) of the Professional Code by seeking to withdraw from employment before he takes reasonable steps to avoid foreseeable prejudice to the rights of his client.
19. Had Murphy, Farrell and Hanify & King obtained the requested discovery against the BRA, DOR, and City of Boston; had they argued and presented the points researched and set forth in their Memorandum, had they argued the point set forth in Alphonse Mourad's Affidavit that they had filed, see Exh."G," had they objected to and disqualified BRA attorney Saul Schapiro from offering an Affidavit, being a witness and attorney advocate in the same case; had they introduced the December 1989 Greystone Financing Commitment and shown how the DOR refused to accept $1,000,000; had they properly defended V&M and Mourad from false accusations of mismanagement, moved for alternation, amendment and for reconsideration of the Court's erroneous April 1, 1996 findings and conclusions, and timely taken an appeal on behalf of the Corporation, the Court would not have appointed a Trustee, or said appointment would have been reversed on appeal.
20. Finally, Harold Murphy and Donald Farrell consciously advised Mourad not to file his proof of claim as a creditor for the approximate amount of $130,000 in the Bankruptcy Court for the reason that "Judge Kenner would be biased to Mourad" (Harold Murphy). He recommended that Mourad wait, and file the claim in State Court. Consequently, Mourad no longer has standing as a creditor to the debtor.
21. Hanify & King, Murphy, and Farrell clearly delivered a political victory to the three governmental agencies (BRA, DOR and City of Boston) at the expense of
V&M Management, Inc., Mourad and his family, V&M's creditors, the residents of Mandela, and the administration of justice, and it is Alphonse Mourad's wish that said parties answer to the Bar of Overseers and be forced to pay the consequences for their detrimental actions.
I declare under the penalties of perjury
that the statements made in this complaint
are true and correct to the best of my knowledge.
Alphonse Mourad
125 West Street HydePark, MA 02136 (617) 364-4010
July_2_, 1997

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