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Friday, May 7, 1999




Judge removes remaining Bishop Estate trustees

Oswald Stender resigns;
the other trustees are
removed for at least 90 days

FULL TEXT OF JUDGE CHANG'S RULING

Star-Bulletin staff

Tapa

Probate Judge Kevin Chang today ordered the temporary removal of four Bishop Estate trustees, and accepted the resignation of the fifth trustee.

Chang issued his historic 14-page order this afternoon after hearing five hours of arguments in Circuit Court on why the trustees should not resign or be temporarily removed from their $1 million-a-year posts.

He accepted the resignation of trustee Oswald Stender, and ordered the removal of trustees Henry Peters, Richard Wong, Lokelani Lindsey and Gerard Jervis.

Named as interim trustees were former Iolani School headmaster David Paul Coon, former Honolulu Police Chief Francis Ahloy Keala, attorney Ronald Dale Libkuman, Hawaiian Electric Industries Inc. treasurer Constance Hee Lau and retired Adm. Robert Kalani Uichi Kihune.

They are "vested with full and complete discretion, power and authority to exercise all trust matters with respect to the trust estate and its subsidiaries and affiliated organizations . . . " Chang wrote.


By Craig T. Kojima, Star-Bulletin
Attorney General Margery Bronster, who spearheaded the
Cayetano administration's inquiry into the trustees' activities
until the Senate refused to reconfirm her, waits in Circuit
Court today before judge Chang's ruling. Spectators in the
courtroom applauded when she entered.



An evidentiary hearing on whether the resignation and removals should be permanent must be scheduled within 90 days after a petition for permanent removal is filed by the state attorney general, the interim trustees or a special panel Chang named earlier to deal with Internal Revenue Service matters, the judge said.

The members of the special panel are the same as the interim trustees named today.

If such a petition is not filed in 90 days, then the "incumbent trustees" can petition for a review of today's order.

The incumbent trustees must immediately surrender their Bishop Estate offices and remove their personal property in 20 days, Chang said.

Deposed trustee Richard "Dickie" Wong told reporters that he will appeal. He added that he is willing to work cooperatively with the temporary trustees in the interim.

Other trustees were not immediately available for comment.

Chang this week had ordered the trustees to show cause why they shouldn't be removed after the IRS, which has been conducting an audit of the 114-year-old trust since 1996, threatened to revoke its tax-exempt status. The estate's court-appointed master, Colbert Matsumoto, had argued that the trust faced imminent harm from the IRS revocation threat.

Circuit Judge Bambi Weil yesterday ordered the immediate and permanent removal of Lindsey, in a separate case brought by Stender and Jervis.



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