Inquiry Concerning a Judge, In re

• Decision Date: 09 March 1990
• Docket Number: No. S-3187,S-3187
• Parties: In re INQUIRY CONCERNING A JUDGE.
• Court: Alaska Supreme Court

Page 716

788 P.2d 716

In re INQUIRY CONCERNING A JUDGE.

No. S-3187.

Supreme Court of Alaska.

March 9, 1990.

George N. Hayes and Jill E. Mickelsen, Delaney, Wiles, Hayes, Reitman & Brubaker, Inc., Anchorage, for appellant.

Arden E. Page, Burr, Pease & Kurtz, Anchorage, for appellee.

Before MATTHEWS, C.J., and BURKE and COMPTON, JJ.

OPINION

COMPTON, Justice.

This is the second time this case has been before the court. See In re Inquiry Concerning a Judge, 762 P.2d 1292 (Alaska 1988) (Judge I ). After holding that the Alaska Commission on Judicial Conduct (Commission) has no constitutional authority to publicly reprimand a judge, Judge I, 762 P.2d at 1296, we remanded the matter to the Commission for recommendation of an appropriate sanction. Id. We did not address the merits of the Commission's findings and conclusions at that time. The Commission now has recommended public censure. We reject the recommendation and impose the sanction of private reprimand.

I. FACTUAL AND PROCEDURAL BACKGROUND

Appellant ¹ is a retired vice-president of a defunct airline named Kodiak Western Alaska Airlines, Inc. (KWA). KWA carried persons, freight and mail from approximately forty bush communities to Kodiak, King Salmon and Dillingham. If a person wanted to travel to Anchorage or anywhere else other than the three mentioned communities, the person had to connect with another airline, usually Wien Alaska Airlines (Wien).

Gifford Aviation Air (Gifford) owned most of KWA's stock. Gifford, an on-call charter air taxi, flew cargo delivery airplanes.

Appellant began his private career as counsel for a consortium of oil companies called the SAM group, standing for Shell, ARCO and Mobil. Part of SAM's off-shore development project involved designing helicopters to explore the Gulf of Alaska. After three years, Appellant practiced law on his own, primarily in aviation. He then became counsel to Wien, a scheduled passenger and cargo carrier at that time, negotiating and granting small bush carriers' reduced rate agreements and other contracts. He left Wien in 1982, after about three years of employment, and started to work for KWA. He negotiated with KWA's board of directors to receive travel benefits immediately upon employment.

Part of Appellant's duties included contracting reduced fare agreements with other airlines. A typical reduced fare agreement gives an airline authority to issue a ticket on another airline at a price less than the published fares. Some airlines declined to enter such an agreement with KWA, while others agreed. ²

An interline agreement, or baggage and ticket agreement, allows airlines to ticket passengers and transfer baggage on one another's routes. KWA was not interested in interlining, being a small airline only providing service from three western Alaska communities to the bush. Furthermore, KWA lacked the computer reservation capability and personnel required to interline.

On July 8, 1982, Appellant contacted Pacific Southwest Airlines about the possibility of entering into a reduced fare agreement, but was notified that PSA was unwilling to extend travel benefits to unscheduled airlines. On April 1, 1983, he inquired again. In response, Mary Anne Galetto, PSA's vice-president of Pricing and Economic Planning, verified that KWA was now a scheduled airline, and offered to enter a reduced fare agreement if KWA would also enter into an interline agreement. Her letter stated:

Our current policy restricts employee travel benefits to employees of airlines with which we interline revenue passengers.

She sent both a reduced fare contract form and an interline contract form to Appellant.

The PSA reduced fare agreement gave each airline authority to self-ticket, or issue reduced fare tickets on its own ticket stock, on a space available basis, to its employees rather than have them obtain the tickets each time from the carrying airline. Blank ticket stock and a validating stamp are used to create such a ticket.

The reduced fare agreement contained the following termination clause:

This Agreement ... shall continue in force and effect until termination by either party, such termination to be effective upon 60 days prior written notice by either party to the other party, to the office designated in this contract....

This termination clause makes no mention of the effect of filing for bankruptcy.

By contrast, the interline agreement contained the following termination clause:

A. Any party hereto may withdraw from the agreement by giving thirty days advance notice of such withdrawal to the other party hereto.

B. However, if the other party has become insolvent, suspended payments or failed to meet its contractual obligations, or has become involved, voluntarily or involuntarily, in proceedings declaring or to declare it bankrupt such notice of withdrawal may become effective on the date of written notice to the other party.

C. A party hereto that ceases to operate scheduled service for 30 days or more for any reason other than a strike shall be deemed to have withdrawn from this agreement, effective 10 days after written notice of such cessation is given to the other party.

Appellant signed both agreements on behalf of KWA and designated Merrill Field, KWA's Anchorage corporate headquarters (also Gifford's business address), as its business address. In testimony Appellant said he agreed to the interline agreement with PSA because it was harmless, if useless:

Q Okay. If you didn't want these interline agreements, ... why did you even sign them--or why were they signed by Mr. Fowler, if you know?

A They didn't hurt us; they didn't cost us anything; they might be applicable in the future with future expansion plans. If the other party desired it, that was fine with us.

While Appellant was employed by KWA, KWA attempted to sell itself. Apparently concerned about the possible effect of such a sale on reduced fare privileges, the Board of Directors of KWA voted to extend reduced travel benefits indefinitely to certain executives, including Appellant, notwithstanding any change in management. ³

The airline was never actually sold during Appellant's tenure. However, Rocky Mountain Helicopters, Inc. took over management of KWA and renamed it "Air Forty-Nine, Inc." without exercising its option to purchase the company.

Appellant became ill and retired from KWA in May 1983. In August 1983, Gifford initiated "Chapter 7" federal bankruptcy liquidation proceedings and a trustee was appointed. Deborah Pickworth, KWA's secretary/treasurer during its operation, stayed on as KWA's comptroller. KWA was finally sold in 1984, but remained a corporation until November 1985.

Sometime after Appellant left KWA in May 1983, Pickworth gave Appellant blank ticket stock and a validating stamp. As a practical matter this allowed Appellant to continue to issue himself reduced fare tickets. Reduced fare billings were to be sent to Pickworth's post office box, instead of the corporate address mentioned in the agreement. Appellant was to pay Ms. Pickworth personally for the tickets. Appellant made no effort to determine if the carrying airlines objected, apparently feeling no obligation to do so. ⁴

On January 1, 1984, the Official Airline Guide informed PSA that KWA had ceased operations. Ms. Galleto did not send KWA a written notice of termination of the reduced fare agreement because "[t]here was no place to communicate any longer with the corporation; it was no longer in business.... There was no need to write letters saying it was suspended." To Ms. Galleto it was a "given."

In June 1985, after having been a sitting judge for approximately six months, Appellant validated blank ticket stock and took a reduced-fare flight from Reno, Nevada to San Francisco, California, on PSA. The ticket contained the identification "Employee Charge" and Appellant's employee ID number. ⁵ In this instance, PSA sent Appellant's bill for $20.60 to the Merrill Field business address, instead of to Pickworth's post office box, thereby alerting the bankruptcy trustee. The trustee's attorney, Bernd Guetschow, demanded the immediate return of the ticket stock and validating stamp from Appellant. Appellant offered to pay the $20.60 bill, but Guetschow refused to allow Appellant to do so. Appellant then paid PSA directly.

Ms. Galetto testified that in her opinion the reduced fare agreement was ineffective without the interline agreement (which terminated upon the initiation of KWA's bankruptcy proceedings):

... You cannot have a reduced fare agreement that allows self-ticketing without an agreement to allow you to do the ticketing.... [T]he ticketing and baggage agreement was null and void. Consequently, no one within Kodiak Alaska Airlines was authorized to write tickets on PSA Airlines any longer. You have to have the ticketing and baggage agreement to issue a ticket on us. Without it, you cannot do so.

. . . . .

[T]here's a fundamental reason ... for a carrier to extend an employee reduced fare agreement to another company. That's--a fluff [sic] thing. That's not a necessity to operating.

Q Okay.

A Whereas a ticketing and baggage agreement is a necessity.

Ms. Galetto further testified that PSA corporate policy prevented integrating an interline agreement and a reduced fare agreement into one document. She said that the purpose of having two separate agreements was that PSA did not always extend reduced fare privileges when an interline agreement had been executed.

Ms. Galetto asserted it was unnecessary for PSA to include the same termination provision in both agreements.

[I]t's unnecessary for two reasons, specifically. One, if a company ceases operation, then they are no longer going to be doing ticketing on another carrier. And the ... reduced fare agreement requires that you can ticket ... since the ticketing and baggage agreement ceases when service ceases, you can't ticket. Secondly ... in the very beginning, it talks about, "[e]ac...