Monday, May 10, 1999

Estate names chief
operating officer

Nathan Aipa will support
Bishop's top executives

By Rick Daysog


The Bishop Estate has appointed its in-house attorney, Nathan Aipa, as the multibillion-dollar trust's interim chief operating officer.

Over the weekend, a panel of five interim trustees named Aipa to the newly created post, after Probate Judge Kevin Chang on Friday temporarily dismissed Richard "Dickie" Wong, Henry Peters, Gerard Jervis and Lokelani Lindsey from their $1 million-a-year trustee posts.

A fifth trustee, Oswald Stender, voluntarily resigned.

The replacement trustees -- attorney Ronald Libkuman, former Honolulu Police Chief Francis Keala, Hawaiian Electric Industries Inc. Treasurer Constance Lau, retired Adm. Robert Kihune and former Iolani School headmaster David Coon -- plan to file court papers today informing the probate court of Aipa's appointment.

The interim trustees also sent notices today to the estate's 1,200 employees of Aipa's appointment, according to Carroll Taylor, attorney for the new board.

Under the move, the estate's principal executives -- Kamehameha Schools President Michael Chun, administrative director Rodney Park, asset manager Randall Chang and Yukio Takemoto, head of the estate's budget and review department -- will all report to Aipa.

But Aipa stressed that his charge will be to support the estate's top executives, especially Chun.

"We want to keep this institution going full steam ahead," Aipa said.

According to Taylor, the interim trustees have not determined Aipa's pay and have not set the length of his temporary appointment. As the estate's general counsel, Aipa earned $186,979 for the year ending June 30, 1997.

The position of a chief operating officer is distinct from that of a chief executive officer. According to Aipa, the interim trustees are in the process of evaluating the hiring of a chief executive.

The previous trustees had agreed to name a CEO and transform the estate into a CEO-based form of management but failed to do so under a court-ordered deadline of March 31.

Aipa, a Bishop Estate trustee employee since 1984, has served as the trust's general counsel since 1986. His appointment comes as members of the special panel are in Los Angeles today to negotiate with the Internal Revenue Service. The IRS, which has been conducting an exhaustive audit of the Bishop Estate since 1996, has threatened to revoke its tax-exempt status if all five trustees do not step down.

The IRS ultimatum prompted Chang to order the temporary removal of the trustees.

According to Taylor, the issue of the interim trustees' salaries also has not been decided. Taylor said the replacement trustees -- who have assumed the full duties and responsibilities of the previous board members -- have been too busy trying to address IRS concerns to look at the issue of trustees' pay.

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