UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF ALASKA

At issue before the court are two motions filed by the debtors on their own behalf. One is a pleading entitled "Motion for Clarification" and the second is a pleading entitled "Motion to Set Aside Stipulation and Notice and to Renew Motion for Clarification." As set forth herein, I am treating the motions, the debtors' supplemental memorandum and the debtors' original motion for clarification as requests for Rule 60(b) relief and granting their requests for relief. This is a core proceeding under 28 U.S.C. § 157(b)(2)(A) and (N).

Background

The history of this proceeding and the related state court litigation is long and complex. I will outline portions of the litigation history and provide a context for the current issues before this court. Also, a time line summarizing the major events in the history of these disputes is attached.

The debtors purchased an historic gold camp near Fairbanks in 1982. They assumed two deeds of trust on the property and gave Chatanika Gold Camp Properties (CGCP), the seller, a third deed of trust along with a $38,000 note for the balance of the purchase price. The debtors defaulted on the CGCP obligation. A foreclosure sale was held on March 28, 1990, and CGCP acquired the property by offset bid. CGCP brought suit to evict the debtors in June of 1990. The debtors refused to vacate the premises and claimed the sale was defective. Following the sale, the debtors were contacted by Masayoshi Okumura (Okumura), to use their property as a site for a northern lights tourist facility. The debtors and their attorney, Art Robson (Robson), negotiated for the placement of

an "Aurorium" on the disputed property. Okumura sent the debtors $638,000 to build facilities at the property. No one told Okumura about the prior foreclosure sale. An aurorium and two cabins were built and Okumura used them in the winter of 1991 to 1992 through a lease with the debtors.

The debtors lost their suit with CGCP and were to be evicted from the gold camp premises. Okumura and his corporation, Transalaska Co. Ltd., sued the debtors and CGCP. He settled with CGCP in May of 1993. The settlement allowed Okumura to remove the aurorium, but CGCP got to retain the two cabins, which remained on the property. Okumura also gave CGCP a security interest in the first $140,000 of any recovery he might receive from Art Robson's malpractice insurance carrier.

Okumura prevailed in his lawsuit against the debtors. He recovered a judgment of $878,000 against the debtors for fraud in May of 1993. The debtors filed a Chapter 7 bankruptcy on June 23, 1993.

The two lawsuits pending against the debtorFRCVCT s at the time of their chapter 7 petition were: Chatanika Gold Camp Properties, Inc., et al. v. McLaughlin, Case No. 4FA-90-963 Civil (the Chatanika Lawsuit); and Masayoshi Okumura and Transalaska Co., Ltd. v. McLaughlin, Case No. 4FA-92-1039 (the Okumura Lawsuit). The Chatanika Lawsuit involved possession of real property following the foreclosure sale by CGCP. The Okumura lawsuit involved fraud with regard to the construction of the aurorium on the same property. The debtors had lost both lawsuits and at the time of their chapter 7 bankruptcy filing were preparing for appeals. Robson represented the debtors in both lawsuits and in their chapter 7 bankruptcy.

After the bankruptcy filing, this court granted relief from stay to allow the debtor's state court litigation to continue on appeal. On August 30, 1993, Kenneth Ringstad, attorney for CGCP, filed an application on behalf of trustee Mitchel Friday to sell the debtors' claims in the two state court cases to CGCP for $5,000. The application stated as follows:

Comes Now the trustee, Mitchel Friday, and applies to the Court for an order authorizing the sale of all debtors' rights, claims and interests in, to, rising [sic] out of and/or stemming from the two State court actions captioned as follows:

      4 ABR 298 

1) Case No. 4FA-92-1039 Civil, MASAYOSHI OKUMURA AND TRANSALASKA CO., LTD., Plaintiffs, v., LORIMER McLAUGHLIN, PAMELA McLAUGHLIN, CHATANIKA GOLD CAMP PROPERTIES, ROBERT J. ROHL, RONALD M. ROHL AND PATRICIA KRIENDLER, Defendants; LORIMER McLAUGHLIN AND PAMELA McLAUGHLIN, Counter Claimant, v., CHATANIKA GOLD CAMP PROPERTIES, et al., Counter Defendants.

2) Case No. 4FA-90-963, CHATANIKA GOLD CAMP PROPERTIES, INC., ROBERT J. ROHL; RONALD M. ROHL AND PATRICIA KRIENDLER, Plaintiffs, v. LORIMER McLAUGHLIN AND PAMELA McLAUGHLIN, Defendants; LORIMER McLAUGHLIN AND PAMELA McLAUGHLIN, v., PATRICIA KRIENDLER, ROBERT GALEOTO AND CHATANIKA GOLD CAMP PROPERTIES, INC.

The purchase price is $5000.00 cash. The purchaser is Chatanika Gold Camp Properties, a partnership.

The trustee believes $5000.00 is a fair and reasonable offer and sale should be approved and authorized by the Court. The trustee's belief is base [sic] on the following:

This Court, based, on among other things, the trustee's nonoppositions, has granted relief from the automatic stay to allow the above described State court actions to proceed. (A copy of the Order is attached hereto as Exhibit A). Prior to the final hearing on the Relief to [sic] Stay, the trustee consulted with Counsel and concluded there is no value to the estate, and if there was value, any such value was outweighed by the cost of litigation. The cost of administering the asset to be sold outweighed their benefit to the estate.

Based on the belief that the cost of administration and potential burden of participating in the State court actions, the trustee intended to abandon the assets which are the subject matter of this application to the debtor and so stated at the final hearing on the Motion for Relief. The offer contained herein was received in response to the disclosure of intent to be abandoned.

The price is believed fair and reasonable. If the sale is not approved, the assets will be abandoned to the debtor. Therefore, the trustee's application should be granted and the sale approved.

DATED in Fairbanks, Alaska, this 30 day of August 1993.


LAW OFFICE OF KENNETH P. RINGSTAD
Attorney for Chatanika Gold Camp
Properties, Robert J. Rohl,
Ronald M. Rohl, Patricia Kriendler
and Robert Galeoto

/s/Kenneth P. Ringstad
Bar No. 8011109

Notice is herby [sic] given that an application to sell the following discribed [sic] property other that [sic] in the ordinary course of business on the following terms and conditions has been filed.

Description: All debtos [sic] rights, claims and interest in, to, rising [sic] out of and/or stemming from the two state count [sic] action captioned as follows:

1) Case No. 4FA-92-1039 Civil, MASAYOSHI OKUMURA AND TRANSALASKA CO., LTD., Plaintiffs, v., LORIMER McLAUGHLIN, PAMELA McLAUGHLIN, CHATANIKA GOLD CAMP PROPERTIES, ROBERT J. ROHL, RONALD M. ROHL AND PATRICIA KRIENDLER, Defendants; LORIMER McLAUGHLIN AND PAMELA McLAUGHLIN, Counter claimant, v., CHATANIKA GOLD CAMP PROPERTIES, et al., Counter Defendants.

1) Case No. 4FA-90-963, CHATANIKA GOLD CAMP PROPERTIES, INC., ROBERT J. ROHL; RONALD M. ROHL AND PATRICIA KRIENDLER, Plaintiffs, v., LORIMER McLAUGHLIN AND PAMELA McLAUGHLIN, Defendants; LORIMER McLAUGHLIN AND PAMELA McLAUGHLIN, V., PATRICIA KRIENDLER, ROBERT GELEOTO AND CHATANIKA GOLD CAMP PROPERITIES [sic], INC.


Type of Sale: Private
Terms and Conditions: $5,000.00 Cash
Name of Purchaser: Chatanika Gold Camp Properties,a partnership

If you object to the proposed sale as described above you must object in writing on or before September, 14 1993 by filing your entitled Court at 605 W. 4th Ave., Ste. 138, Anchorage, Alaska 99501-2296 and serve a copy on the undersigned and the trustee, Mitchel Friday at P.O. Box 83690, Fairbanks, AK 99707 on or before said date.

SHOULD YOU FAIL TO SO OBJECT OR HAVING OBJECTED FAIL TO TIMELY REQUEST A HEARING, BE FURTHER ADVISED THAT THE UNDERSIGNED WILL PRCEED [sic] WITH THE PROPOSED USE, SALE OR LEASE DESCRIBED ABOVE WITHOUT FURTHER NOTICE TO YOU, UNLES [sic] A TIMELY OBJECTION IS SUSTAINED BY THE COURT.

The application is available for inspectin [sic] at the office of the Clerk, 605 W. 4th Ave., Ste. 138, Anchorage, AK 99501-2296 or at the office of the undersighned [sic].

Dated 8/20/93                         /s/Kenneth P. Ringstad

               Kenneth P. Ringstad
               Attorney for C.G.C.P.
               Bar No. 9011109

The notice was served on the matrix. Robson filed a timely objection to the sale. After a hearing on September 21, 1993, the court granted the motion for sale.

In October, 1993, Okumura filed a state court civil action against Robson for fraud and malpractice. CGCP sued Robson for malpractice in April of 1994, relying on its alleged purchase of malpractice claims through the September 21, 1993, sale order. CGCP subsequently executed a waiver in favor of National Union, Robson's insurance carrier, that allowed National Union to disburse $900,000 in insurance proceeds to Okumura on his claim against Robson. CGCP in turn received $90,000 of these insurance funds in satisfaction of its prior settlement with Okumura in December, 1994. This was less than the $140,000 the parties had agreed to originally.

The appeals in the two state court cases were subsequently dismissed, after some procedural maneuvering by the debtors in bankruptcy court. In August of 1994 the debtors became aware that GCP was asserting malpractice claims against their attorney, Robson, based upon the sale to CGCP of the estate's interest in the litigation rights in the two lawsuits previously approved by the court. This prompted the debtors to file a motion on August 11, 1994, seeking clarification of the sale order. The motion was opposed by Ringstad on behalf of CGCP. A hearing on the motion for clarification was scheduled for November 1, 1994. The parties entered into a stipulation whereby the matter was removed from the calendar as the parties were "close to settlement." On December 5, 1994, a stipulation for withdrawal of the motion for clarification was filed. The stipulation was prepared in conjunction with the $900,000 settlement of Okumura's claim against Robson. On December 28, 1994, this court entered an order approving the stipulation to withdraw the motion for clarification.

The stipulation to withdraw the motion was not signed by the debtors. It was signed by Robson, purportedly on behalf of the debtors, and by Ringstad and trustee Mitchel Friday.

Robson did not advise the McLaughlins of the stipulation and the subsequent order which withdrew their motion for clarification. In fact, he informed them of just the opposite: that the motion for clarification was still pending. The McLaughlins were also unaware of the Okumura       4 ABR 301  settlement and the CGCP waiver. The McLaughlins continued to be in the dark on the matter until they finally obtained the bankruptcy court records, determined that Robson had been misleading them, and filed their current motions in September of 1995.

Robson had no authority to execute the stipulation filed December 5, 1994. Robson acted solely in his own interests, to preserve his personal assets from malpractice claims, without consent or authority for compromise or dismissal of the motion from his clients.

Analysis

A compromise or settlement of a claim by an attorney is not binding on his clients when it is executed without their consent. 7 Am. Jur. 2d, Attorneys at Law, ¶ 156 (1980). The stipulation to withdraw the motion for clarification was entered without the consent of the debtors by Robson. Hence, my December 28, 1994, order was entered under the mistaken belief that the debtors consented to the withdrawal of the motion. Pursuant to Rule 9024 of the Federal Rules of Bankruptcy Procedure, and Rule 60(b) of the Federal Rules of Civil Procedure, my December 28, 1994, order will be vacated. The original motion for clarification is still at issue. I view it as a request for Rule 60(b) relief.

Through their motions for clarification, and their subsequent memoranda, the McLaughlins do not seek to relitigate the issues previously raised with regard to sale of the estate's interest in the litigation rights from the two lawsuits. Rather, they seek a specific determination by this court that either the malpractice claims were not included in the sale, or, if they were included, they were sold for such nominal consideration and under such inequitable circumstances, that the sale, insofar as it included malpractice claims, should be set aside with respect to such claims.

Sales confirmed by the court are set aside in rare instances. Ninth Circuit law on this subject requires an examination of a number of factors. One of those factors is a policy of finality. That policy must be weighed against "compelling equities." As the Ninth Circuit noted in Matter of Cada Investments, Inc., 664 F.2d 1158, 1162 (9th Cir. 1981):

The policy of finality is not, however, absolute: in limited circumstances the courts have set aside confirmed sales. Courts have generally appeared willing to set aside       4 ABR 302 

confirmed sales that were "tinged with fraud, erroFRCVCT r or similar defects which would in equity affect the validity of any private transaction." In re General Insecticide Co., 403 F.2d at 631 (quoting 4A Collier on Bankruptcy, ¶ 70.98[16] (14th ed. 1967)). This policy was reflected in Wolverine v. Shell Oil Co., 442 F.2d 666 (9th Cir. 1971), where this court affirmed an order to set aside a confirmed sale on the ground that there were special dangers of interested dealing.

Confirmed sales have also been set aside on direct review of confirmation in district courts. Thus, in Proctor & Gamble Manufacturing Co. v. Metcalf, 173 F.2d 207 (9th Cir. 1949), this court affirmed a district court order reversing a referee's confirmation; the district court set aside the sale only because information, discovered after confirmation, indicated that the price originally received was inadequate. Although the appeals court questioned the ability of the district court to set aside its own order of confirmation, it approved the district court's decision to reverse the referee's confirmation. Id. at 209.

In limited circumstances, confirmed sales (or orders involving other vested rights) have been properly set aside by the confirming court in the absence if the type of fraud or error referred to in General Insecticide. In In re Time Sales Finance Corp., 445 F.2d 385 (3d Cir. 1971), cert. denied sub nom. Gross v. Welsh, 405 U.S. 917, 92 S.Ct. 940, 30 L.Ed.2d 786 (1972), the Third Circuit upheld an order setting aside a sale because, through an "innocent mistake," the trustee's attorney failed to notify a bidder of the confirmation hearing. The court suggested that the "major question" in examining the propriety of orders to set aside is "one of common decency," and concluded that the referee acted "completely within his sound discretion" in "immediately ... call[ing] for a new hearing which gave everybody concerned equal opportunity to buy the particular property." 445 F.2d at 387. See also In re Lamont, 453 F. Supp. 608 (N.D.N.Y. 1978), aff'd mem., 603 F.2d 213 (2d Cir. 1979); In re Lintz West Side Lumber, Inc., 655 F.2d 786 (7th Cir. 1981) (affirming order to set aside abandonment of estate property to secured creditors on basis of evidence, discovered after abandonment, that secured interests were improperly perfected).

[2] These cases lead us to conclude that, although the policy of finality normally protects confirmed sales from orders to set aside, sales are properly set aside when compelling equities outweigh the interests in finality.

Similar approaches have been utilized by courts outside the Ninth Circuit to invalidate bankruptcy sales. In In re WPRV-TV, Inc., 983 F.2d 336 (1st Cir. 1993), the court affirmed a bankruptcy court order invalidating the sale of a television station. In In re Silver Bros.       4 ABR 303  Co., Inc., 179 B.R. 986 (Bankr. D. N.H. 1995), the court vacated a prior order allowing the assignment and sale of a counter-claim to the wife of the debtor's principal officer and shareholder.

Here, compelling equities outweigh the interests of finality for several reasons. The pleadings prepared by Ken Ringstad on the trustee's behalf were less than candid. Neither his application for approval of sale nor his reply to objection to sale mention malpractice claims or state their value. Both documents represent that the purchase price of $5,000 for litigation rights is "fair and reasonable." At best, the representations regarding the sale were inaccurate and misleading. At worst, they were "tinged with fraud" within the meaning of Cada Investments.

Ringstad argues that the value of the malpractice claims was unknown at the time of the sale. However, RingstFRCVCT ad's client, CGCP, had already reached a settlement with Okumura in which it was given a security interest in up to $140,000 of any malpractice recovery Okumura might obtain against Robson. Based on CGCP's intimate familiarity with the foreclosure on the gold camp property and Okumura's claims against the debtors, as well as its knowledge of Okumura's intentions to pursue malpractice claims against Robson, it is difficult to believe that CGCP was unaware of the existence and viability of malpractice claims against Robson at the time it offered to purchase estate assets. It is also difficult to believe that any mention of the malpractice claims, and their potential value, was simply overlooked by Ringstad when the application to sell was prepared.

Further, the price paid for the claims was not fair and reasonable. In fact, the price paid was so unreasonable it shocks the conscience of this court. Mason v. Ashback, 383 F.2d 779 (10th Cir. 1967). CGCP, by virtue of its alleged purchase of the malpractice claims from the estate, has been able to assert malpractice claims against two insurance carriers who each extended professional liability coverage of $1,000,000 to Robson. CGCP's waiver of its claim against National Union allowed it to obtain a payment of $90,000 from Okumura in satisfaction of the prior $140,000 settlement. CGCP argues its receipt of this money should be viewed as an independent event because its settlement with Okumura preceded its purchase of the claims from the bankruptcy estate. However, the timing       4 ABR 304  of events is simply too cozy. Robson's withdrawal of the debtors' initial motion for clarification (without their consent) coincided with CGCP's written waiver and Okumura's payment of $90,000 to CGCP. Although CGCP's secondary claim against National Union was settled and judgment entered in favor of National Union, CGCP continues to press a malpractice claim against Robson's other professional liability carrier, the Attorneys' Liability Protection Society (ALPS), for substantial sums. In a forceful letter dated November 23, 1994 (again, around the time Robson withdrew the motion for clarification), Ringstad demanded $600,000 from ALPS for immediate settlement of the claim. ALPS, which also extended Robson $1,000,000 in malpractice coverage, is currently defending against this claim in Fairbanks Superior Court, Case No. 4FA-94-1081 Civil, and denies liability. While it is impossible to place a precise monetary value on the ALPS claim at this time, I conclude that the malpractice claims have substantial value. When coupled with the $90,000 CGCP received from Okumura through execution of the waiver, the price paid for the malpractice claims is indefensible.

Moreover, the notice of the proposed sale was deficient and inadequate. It did not list the sale of any malpractice claims against Robson. While such claims were included within the broad language of the notice, the sale of malpractice claims was not apparent on the face of the notice to either the court or to creditors who received it. Both the debtors and Robson repeatedly represented to the court that these actions were valuable to the estate and the appeals should be pursued. It appeared that CGCP simply wanted to purchase the estate's rights to the two pending lawsuits for nuisance value before they were abandoned back to the debtors, who clearly intended to pursue them. In fact, when Ringstad was asked by the court why the sale of the two lawsuits to CGCP was a good deal for the estate, Ringstad replied that the sale would bring $5,000 into the estate for assets which would otherwise be abandoned by the trustee. It is now apparent that the sale benefitted CGCP to the detriment of the estate and its other creditors and that this benefit was anticipated by CGCP at the time the offer to purchase was made.

Moreover, the notice of the proposed sale was inadequaFRCVCT te in other respects. There were several typographical errors in the notice that       4 ABR 305  made compliance with it difficult. For instance, the description of assets in the notice starts with: "All debtos [sic] rights. . . ." This error, while perhaps obvious, adds to the confusion generated by the general description of litigation rights unaccompanied by any specific description of malpractice claims. In the second paragraph from the bottom, the notice states: "If you object to the proposed sale as described above you must object in writing on or before September, 14 1993 by filing your entitled Court at 605 W. 4th Ave., . . . ." Again, this is confusing language. The instructions with regard to the filing of objections are unintelligible. I conclude that the notice was inadequate.

Finally, considering the compelling equities of this matter, the court cannot overlook the many benefits CGCP has gained through the debtors' ill-advised reliance on Art Robson. On its original liability of $38,000, CGCP has received: (1) $30,000 in interim payments from the debtors after the foreclosure sale; (2) the return of the 60-acre gold camp along with two new cabins constructed by Okumura; (3) at least $20,000 from the supersedeas bond posted by the McLaughlins; (4) $10,000 from Okumura in June of 1993; and (5) $90,000 from Okumura in December, 1994. As it now stands, CGCP stands to profit from further actions against ALPS at the expense of the debtors and their legitimate creditors.

CGCP argues that the court was aware that Ringstad, its attorney, prepared the application for sale on behalf of the trustee. I agree. However, the fact that he noticed and prepared the application for sale on her behalf does not excuse his duty to sign and file pleadings that are "well-grounded in fact" under Rule 9011 of the Federal Rules of Bankruptcy Procedure. His representations as to the reasonableness of the sale were not well founded regardless of whom he represented. CGCP also argues that the debtors stated they had no malpractice claims against Robson at the time of the sale and failed to list any such claims in their schedules. It is undeniably true that the debtors were blindly loyal to their friend and advisor Robson. Their beliefs, however, were simply those of uneducated laymen and certainly not definitive on the issues. CGCP's attorney Ringstad was in the ideal position to evaluate such claims and take advantage of the debtors'       4 ABR 306  ignorance. I conclude

that their ignorance and denial of malpractice claims against Robson provides no justification for the supposed sale.

The application for sale was inaccurate and misleading because it did not fully disclose what assets CGCP intended to purchase. The sales price of $5,000 for the malpractice claims shocks the conscience of the court. The notice of the sale was inadequate. I conclude that compelling equities outweigh the interests of finality. Based on Cada Investments, Rule 9024 of the Federal Rules of Bankruptcy Procedure, and Rule 60(b)(1) and (3) of the Federal Rules of Civil Procedure, the September 21, 1993, sale order will be vacated insofar as it purports to transfer any malpractice claims or rights to CGCP.

11 U.S.C. § 363(m) provides that a reversal or modification on appeal of an authorized sale under 363(b) or (c) "does not affect the validity of the sale or lease under such authorization to an entity that purchased or leased such property in good faith." However, § 363(m) is inapplicable here. A Rule 60(b) motion is not an appeal. Further, even assuming this proceeding were an appeal, I find that CGCP was not a "good faith purchaser" within the meaning of the Bankruptcy Code. I regard the circumstances surrounding the sale and settlement of the claim as an attempt by CGCP to take grossly unfair advantage of the debtors and other creditors through purchase of the malpractice claims at an unrealistically low price. While there was no appraisal available of the malpractice claims at the time of the sale, I do not regard $5,000 as sufficient "value", given the facts of this case. Ordinarily, "value" is defined as at least 75% of the appraised value of an asset. Willemain v. Kivitz, 764 F.2d 1019 (4th Cir. 1985); In re Ewell, 958 F.2d 276 (9th Cir. 1992). CGCP is not entitled to the protections of 11 U.S.C. § 363(m).

Miscellaneous

The debtors raised a host of other issues in their motion for clarification. Questions regarding the Internal Revenue Service (IRS) cannot be resolved unless the debtors bring an appropriate action against the IRS. It appears that funds were to be distributed to the IRS by the bankruptcy trustee. In her final report, $4,597.36 was to be paid to the IRS. The debtors inquired as to whether or not they could "sue the       4 ABR 307  trustee on her bond." I cannot issue advisory opinions. Finally, the debtors asked if payment of the $900,000 would provide satisfaction of or credit against the Okumura judgment. This issue has to be raised within the adversary action and not in the main case.

Conclusion

The equities in this case clearly favor the McLaughlins. The original sale order will be set aside in part and a new trustee will be appointed to administer the estate. An appropriate order and judgment will be entered as separate documents.

DATED: April 5, 1996.

BY THE COURT
DONALD MacDONALD IV
United States Bankruptcy Judge

1982	The debtors purchase a historic gold camp from CGCP, assuming existing liens on the property and giving CGCP a $38,000 note, secured by a deed of trust on the property, for the balance.
03/28/90	CGCP acquires title to the property by offset bid at a nonjudicial foreclosure of its deed of trust.
June, 1990	CGCP files suit to evict the debtors from the property in Fairbanks Superior Court: Chatanika Gold Camp Properties, Inc., et. al. v. McLaughlin, Case No. 4FA-90-963 Civil.
1990	After the foreclosure sale, Masayoshi Okumura negotiates with the debtors and their attorney, Robson, regarding the possibility of building an "Aurorium" on the property. Okumura sends $638,000 to the debtors to build the aurorium and 2 cabins on the property.
1991-1992	Okumura leases the aurorium and cabins from the debtors during the winter for use by tourists.
1992	CGCP prevails in its suit against the debtors for possession of the property. The debtors are evicted.
1992	Okumura sues the debtors and CGCP for fraud in Fairbanks Superior Court: Masayoksi Okumura and Transalaska Co., Ltd. v. McLaughlin, Case No. 4FA-92-1039 Civil.
May, 1993	Okumura settles with CGCP, granting CGCP a security interest in the first $140,000 of any recovery he might receive from Robson's malpractice insurance carrier.
May, 1993	Okumura prevails against the debtors in the state court       4 ABR 308  civil action and obtains a judgment for fraud in the amount of $878,000.
06/23/93	The debtors file their Chapter 7 petition, Case No. F93-00468-DMD.
07/02/93	Ringstad files a motion for relief from stay to enable the two state court civil actions to proceed on appeal.
08/11/93	A hearing on Ringstad's motion for relief from stay is held. There is some discussion at the hearing regarding the chapter 7 trustee's intent to abandon the two state court cases. The court grants the motion for relief from stay.
08/30/93	Ringstad files, on behalf of the trustee, a motion to sell the debtors' rights, claims and interests in the two state court cases to CGCP for the sum of $5,000.
09/21/93	After holding a hearing, the bankruptcy court approves the motion to sell.
Oct. 1993	Okumura files suit against Robson for malpractice.
April 1994	CGCP files suit against Robson for malpractice, based upon its purchase of all debtors' rights in the two state court civil actions from the bankruptcy estate.
08/11/94	The debtors' attorney, Robson, files a motion for clarification of the court's order approving sale of the two state court cases.
09/30/94	First hearing on the debtors' motion for clarification is held. After hearing from all parties, the court continues the hearing without date. The parties are to contact the court regarding a continued hearing date when the testimony of the trustee can be taken.
11/01/94	A stipulation putting over the continued hearing on the motion for clarification is filed, because the parties are "close to settlement," and the hearing, set for this date, is vacated.
12/05/94	Stipulation between counsel for withdrawal of motion for clarification is filed. The stipulation is signed by Robson, Ringstad and the trustee. Robson did not have the consent of his clients to withdraw the motion.
12/22/94	CGCP receives $90,000 from Okumura in satisfaction of the $140,000 settlement entered in May, 1993.
12/28/94	The bankruptcy court enters an order approving the stipulation for withdrawal of motion for clarification.