By motion filed June 3, 1991, the Ricks have requested this court to reconsider its order of May 23, 1991, which dismissed this proceeding as moot, and to render a decision on the issue of whether Fay Forshey's judgment against the Ricks was obtained by fraud. The motion is denied. There is no reason to change the Judgment. Whether considered on grounds of mootness or on the merits, the May 23, 1991 Judgment of this court remains correct.

Issue of Fraud

        This case was remanded from the District Court "for an evidentiary hearing on the issue of whether [Fay Forshey's] judgment was obtained by fraud and for a determination of whether     2 ABR 144  the claim should, therefore, be disallowed." ORDER (Decision on Appeal) entered December 15, 1989, page 8, United States District Court No. F89-004 Civil.

        A thorough review of the record from the state court trial and from the trial before this court establishes the following:

        1.    At the state court trial of Forshey v. Ricks, 4FA-84-1448, which resulted in the judgment which the Ricks contend was obtained by fraud, the Ricks' defense was that Forshey had intended to "fake an injury" and collect damages from them.

        2.    At the trial before this court, the Ricks contended that Forshey's state court judgment had been obtained by a fraudulent scheme to "fake an injury" and collect damages from them.

        3.    At the state court trial, numerous witnesses testified as to Forshey's poor reputation for truth and veracity in the community of Delta Junction. The same testimony was given by several of the same witnesses at the trial before this court. One witness, Theta Musgrove, testified at both trials that Forshey had told her the only way she could make a living in Delta Junction was through her lawsuits.

        4.    Richard Kipp did not testify at the state court trial. Kipp is a close family friend of the Ricks and their children. The Ricks contended that Kipp was a crucial witness to     2 ABR 145  proving Forshey's fraudulent scheme, but that they had been prevented from calling him as a witness at the state court trial because they were not aware until shortly after that trial that Kipp had seen Forshey at the 4-plex the morning of the accident. Kipp's testimony before this court was that Forshey was at the 4-plex the morning of her injury, that she stood at the door that morning with Kipp, and saw that there was a hole in the floor beyond the door.

        5.    The door to the 4-plex had been cut the night before the accident occurred. On the day of the accident, December 30, 1983, the door had a makeshift step on the exterior of the 4-plex which required one to step up approximately 9 inches. To reach the sill, one would then have had to step up approximately 19 inches. With the door closed, the sill on the outside of the 4-plex was, at most, 8 inches wide. There were no handrails on the outside of the door; the only support would have been to hold onto the doorknob or, if the door were open, to hang onto the door jamb. There were no barricades or warning signs around the door. Immediately inside the door, in the interior of the 4-plex, there was a hole in the floor. The drop to the basement was approximately 6 feet.

        6.    Forshey fell through the hole in the floor of the 4-plex when she went there to discuss money matters with John Ricks. The accident occurred late in the afternoon, when it was dark. Her injuries resulting from that fall are the basis of her judgment against the Ricks.

        7.    Kipp first learned of Forshey's accident the day after it occurred, when he went to work for the Delta Junction EMT's. He testified that his first impression after hearing about Forshey's fall was that she had made a mistake while trying to climb the ladders set up to negotiate over the hole in the floor at the 4-plex. Kipp said he had had trouble climbing these ladders when he was at the 4-plex the previous morning.

        8.    Kipp testified that he didn't tell the Ricks what he had seen before the state court trial, because he didn't think it was important. However, in a deposition taken in December of 1988, Kipp testified that the first time he discussed Forshey's accident with John Ricks was within a few days of the accident, when he told Ricks he had been at the 4-plex that morning, but did not mention that he had seen Forshey there. Also, in a deposition taken in May of 1990, Bonnie Ricks testified that Kipp had discussed the Forshey state court trial with both she and her husband between the time of the accident and the trial, more with her husband than with her.

        9.    Kipp also testified before this court that Delta Junction is a small town and that the topic of the trial was generally discussed there. Kipp said he first told the Ricks about seeing Forshey at the 4-plex shortly after conclusion of the state court trial, when he learned the basis of her judgment was that she didnt know there was a hole in the floor. Kipp also stated that Forshey had asked him several times before the trial if he would testify.

        10.    Fay Forshey testified before this court that she was not at the 4-plex the morning of the accident, and did not see Kipp that morning. She said she did ask Kipp if he would testify at the state court trial, probably out of curiosity to see who was going to come and, also, because she knew Kipp was a friend of the Ricks and that several people in Delta Junction would be character witnesses against her. Forshey's testimony regarding not seeing Kipp the morning of the accident was consistent with her prior deposition testimony given in October of 1988.

        11.    Forshey's daughter, Judy, testified before this court that she was on Christmas vacation when Forshey's accident occurred. Judy stated that the usual routine at her mother's house during that time was that she and her mother would get up around 10:00 a.m. and do chores. She said her mother did not get up early the morning of the accident, was home all morning, and they observed their usual routine. Late that afternoon, she went with her mother to the Ricks' residence and then to the 4-plex, where the accident occurred. She waited in the car while her mother went into the 4-plex to try to talk to John Ricks.

        12.    John Ricks testified before this court that he first saw Forshey at his residence in the late afternoon on the day of the accident. He told Forshey he couldn't talk to her just then, but would be willing to talk to her after he took some heating fuel over to the 4-plex. Alternatively, he told Forshey he would talk     2 ABR 148  to her at the 4-plex after he delivered the fuel. He told Forshey to wait in the car if she went to the 4-plex. Ricks then went to the 4-plex and, shortly after he started to pour the fuel into the heater, he heard a loud bang as the door slammed against the floor joists, immediately followed by moaning. Ricks said when he went to look through the hole in the floor, he saw Forshey lying in the basement. This testimony is consistent with Ricks' testimony at the state court trial. Ricks also confirmed that, at his deposition taken in 1990, he had testified that he'd concluded Forshey meant to step over the ladders placed at the hole in the floor and fell, and that he didn't think Forshey intended to jump.

        13.    John Ricks testified at both trials that he would not be able to stand on the door sill without holding on to either the door knob or door jamb, because otherwise "Mr. Gravity" would take over and he would fall.

        14.    At the trial before this court on May 20, 1991, all of the Ricks' witnesses, including Kipp, stated that Forshey had not done anything to influence their testimony, or prevent them from giving testimony, at either the state court trial or the trial before this court.

        The Ricks have asked this court to disallow Forshey's claim on the grounds that her state court judgment against them was fraudulently obtained. This court has the "power to sift the circumstances surrounding any claim to see that injustice or
    2 ABR 149  unfairness is not done in the administration of the bankruptcy estate." Pepper v. Litton, 308 U.S. 295, 308 (1939).

        The Ninth Circuit has adopted the following standard for determining whether a judgment was obtained by fraud:

Under Rule 60(b)(3) [of the Federal Rules of Civil Procedure], the moving party must establish by clear and convincing evidence that a judgment was obtained by fraud, misrepresentation, or misconduct, and that the conduct complained of prevented the moving party from fully and fairly presenting the case.

        The Ninth Circuit utilizes a different standard when considering whether to set aside a judgment for "fraud upon the court" in an independent action brought by a party. A judgment may be set aside for fraud on the court in situations where there is clear evidence of "an unconscionable plan or scheme which is designed to improperly influence the court in its decision." Abatti v. C.I.R., 859 F.2d 115, 118 (9th Cir. 1988), citing Toscano v. C.I.R., 441 F.2d 930 (9th Cir. 1971). Again, Alaska has a similar standard. The Alaska Supreme Court has indicated that     2 ABR 150  fraud on the court requires "the most egregious conduct involving a corruption of the judicial process itself." Lowe v. Lowe, ___ P.2d ___ , 1991 WL 136761, n. 9 (Alaska, July 26, 1991), citing Allen v. Bussell, 558 P.2d 496, 500 (Alaska 1976).

        I find that the Ricks have failed to meet their burden of proof on the issue of Forshey's fraud under any of these standards. The proof presented at the trial was akin to a second negligence trial: clear evidence of fraud on the court was not supported. There was no substantial evidence of fraud on the part of Forshey which would have prevented the Ricks from fully and fairly presenting their case, nor has there been clear evidence of an unconscionable plan designed by Forshey to improperly influence the court.

        The direct evidence of fraud consists solely of Kipp's statements that Forshey was on the accident scene that morning. Kipp's statement is not directly corroborated by any other witness. Kipp is a close friend of the Ricks. Forshey's statement that she was not on the scene is corroborated by her daughter, who had personal knowledge of her mothers whereabouts. At best the alleged evidence of fraud is evenly balanced, if not in Forshey's favor. Ricks' counsel repeatedly emphasized the fact that Forshey asked Kipp if he was going to testify. That question does not rise to the level of clear and convincing evidence of fraud. Moreover, the fact that Forshey's reputation for veracity is poor in Delta     2 ABR 151  Junction is more than offset by Kipp's close relationship with the Ricks.

        Even assuming Forshey lied about being at the scene that morning, the Ricks failed to clearly demonstrate the judgment would have been reversed. There was abundant evidence of negligence on the Ricks' part at the state court trial. The door at the 4-plex clearly presented a dangerous situation on the day of the accident. Both Kipp and Ricks acknowledged that it would be easy to fall in the hole. Ricks had every opportunity to avoid the danger of a hazardous situation by blocking the entrance, posting a sign, providing additional lighting and temporarily covering the hole. He failed to do so. He also failed to prove that the results of the judicial proceeding would have been substantially affected by Forshey's alleged misstatement.

        I therefore conclude that Forshey's judgment was not obtained by fraud and, therefore, her claim would be allowable in bankruptcy.

Allowance of Forshey's Claim is Moot

        Although I have concluded that Forshey's claim did not arise through fraud, I continue to decline to rule on the issue of whether her claim should be allowed on the grounds of mootness. The main case has been fully administered and closed, with no assets available for distribution. As noted in my prior order,     2 ABR 152  whether Forshey's claim is allowed or not, she will not receive a distribution from the bankruptcy estate.

        For the foregoing reasons, I find that dismissal of this complaint, consistent with the Clerk's judgment entered May 23, 1991, was appropriate. IT IS ORDERED that the plaintiff's motion for reconsideration is denied; Judgment as entered shall not be amended or altered in any respect.

        Dated: September 25, 1991.

BY THE COURT




DONALD MacDONALD IV
United States Bankruptcy Judge