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Alaskan Adventure Tours, Inc. v. City and Borough of Yakutat

Supreme Court of Alaska

August 23, 2013

ALASKAN ADVENTURE TOURS, INC., Kimberly Riedel-Byler, aka Kimberly C. Riedel, K. Christina Riedel, and/or Kimberly Byler, and ABC Leasing, LLC, Appellants,
v.
The CITY AND BOROUGH OF YAKUTAT, Appellee.

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[Copyrighted Material Omitted]

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John E. Casperson, Holmes Weddle & Barcott, Seattle, Washington, for Appellants.

James T. Brennan, Hedland, Brennan and Heideman, Anchorage, for Appellee.

Before: FABE, Chief Justice, CARPENETI, WINFREE, and STOWERS, Justices.

OPINION

CARPENETI, Justice.

I. INTRODUCTION

This appeal concerns a company's efforts to vacate a fraudulent conveyance judgment. The company sought relief under Alaska Civil Rule 60(b)(3), claiming fraud and misconduct on the part of a borough in the course of a fraudulent conveyance trial concerning liability for property taxes. Specifically, the company argued that a police officer falsely testified at trial concerning a conversation he allegedly had with the company president regarding the company's obligation to pay borough taxes. The superior court denied relief under Rule 60(b)(3), finding that the company had failed to establish clear and convincing evidence of fraud. The company appeals, arguing that the superior court applied the incorrect legal standard and that the company presented clear and convincing evidence of fraud. The company also appeals various orders relating to discovery and the award of attorney's fees. Because the superior court applied the correct legal standard and did not abuse its discretion in finding that there was not clear and convincing evidence of fraud, we affirm its denial of the Rule 60(b) motion. Because the superior court did not abuse its discretion in refusing to reopen discovery or awarding attorney's fees, we affirm those rulings as well.

II. FACTS AND PROCEEDINGS

A. General Background

The City and Borough of Yakutat (Yakutat) instituted an action to collect taxes from Alaskan Adventure Tours, Inc. (Adventure Tours). Adventure Tours operated a commercial hunting and guide business in 2007; Kimberly Byler [1] was the owner and president of the company, and her husband Darren Byler was the general manager. In 2008 Yakutat filed an action in state district court against Adventure Tours related to unpaid sales and transient accommodation taxes and obtained a final judgment in the amount of $95,808.46 for unpaid taxes, penalties, interest, and other costs. In April 2009 Yakutat filed a supplemental complaint alleging that Adventure Tours and Kimberly had (in late 2007 and early 2008) engaged in fraudulent conveyance to avoid payment of the taxes by transferring all of Adventure Tours' assets to Kimberly personally and then to ABC Leasing, LLC, another company solely owned by Kimberly.

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The fraudulent conveyance claim was transferred from the district court to the superior court, and Superior Court Judge Patricia A. Collins presided over a jury trial in February 2010. At trial, Adventure Tours and co-defendant Kimberly defended on grounds that they had no notice of Yakutat's tax claim at the time of the asset transfers. John Nichols, the Yakutat chief of police, testified that he had a conversation with Kimberly in 2007 during which she demonstrated awareness of Yakutat's tax claim against Adventure Tours. He stated that this conversation took place as he drove Kimberly to the airport after interviewing her in May 2007 about an unrelated matter at the Yakutat police station. Kimberly testified that this conversation never occurred and that Chief Nichols did not drive her to the airport. Apart from Chief Nichols's testimony, Yakutat offered substantial additional evidence of notice at trial. This evidence included the following: (1) several letters from Yakutat to Adventure Tours, sent in 2004, 2005, and 2007, advising Adventure Tours of the obligation to pay Yakutat taxes when doing business in the area; (2) Yakutat attorney Sara Heideman's testimony that Darren Byler had called her in May 2007 to dispute Adventure Tours' liability for the taxes and evidence in support of this testimony, including Heideman's contemporaneous notes, her time sheet, and Adventure Tours' phone records; and (3) Yakutat tax and license clerk Ladonna James's testimony that Kimberly called James in response to a February 2007 letter from James to discuss Adventure Tours' obligations to pay Yakutat taxes.

The jury found that Adventure Tours and Kimberly had fraudulently conveyed assets to ABC Leasing. It also found that Kimberly had intentionally testified untruthfully at her judgment debtor examination regarding the existence or value of Adventure Tours' assets and as to the availability of Adventure Tours' business records. On the basis of these verdicts, Judge Collins entered judgment in favor of Yakutat on March 18, 2010.[2]

One year later, Adventure Tours moved for relief from the fraudulent conveyance judgment under Alaska Civil Rule 60(b)(3) on the basis of fraud and misconduct on the part of Yakutat. Alternatively, Adventure Tours requested that the court hold the motion in abeyance and permit Adventure Tours additional time to conduct new discovery. Judge Collins denied the motion and awarded Yakutat enhanced attorney's fees of 50% for opposing Adventure Tours' Rule 60(b) motion. Adventure Tours then brought a motion for reconsideration, which was denied by Superior Court Judge Niesje J. Steinkruger.[3] Adventure Tours now appeals the denial of its Rule 60(b)(3) motion and its motion for reconsideration. It also appeals the superior court's denial of its request to reopen discovery and the court's order awarding Yakutat enhanced attorney's fees.

B. Facts And Proceedings Directly Related To The Issues On Appeal

A key issue at the fraudulent conveyance trial was whether Adventure Tours had notice of Yakutat's tax claims at the time of the asset transfer from Adventure Tours to Kimberly Byler to ABC Leasing. The central claim in Adventure Tours' Rule 60(b) motion was that Chief Nichols falsely testified at trial that he had discussed Yakutat's tax claim with Kimberly when he drove her to the airport on May 15, 2007.

1. Summary of factual disputes

The parties dispute whether Chief Nichols drove Kimberly Byler to the airport on May 15, 2007 and, consequently, whether they discussed Adventure Tours' tax obligations to Yakutat at that time. Adventure Tours asserts that Chief Nichols falsely testified that he gave Kimberly a ride to the airport. Adventure Tours supports this assertion with two allegations. First, Adventure Tours alleges that Chief ...


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