In Re Jeri L. Pace, Debtor. John E. Havelock John R. Strachan v. Harold S. Taxel, Trustee

Debtor’s counsel appeal from an affir-mance of the bankruptcy court’s award of costs and attorney’s fees to the trustee, arguing that the trustee is not entitled to recover his fees under either sections 105(a) or 362(h) of the Bankruptcy Code. We uphold the decision in favor of the trustee but remand for a determination of the amount of damages to be awarded under section 105(a).

FACTS AND PRIOR PROCEEDINGS

Jeri LeMai (“LeMai”) and her former husband, H. Russell Pace (“Pace”), were joint shareholders in and sole owners of two Alaska corporations, The Pines Corporation and Pace Corporation (jointly, “the Corporations”). The Corporations’ principal assets consisted of an Alaska nightclub and two liquor licenses. In May of 1984, LeMai and Pace retained the services of a local law firm to help them sell their interest in the Corporations. In January of 1985, the Corporations sold their assets, including the liquor licenses, to two individuals and a newly formed corporation, The New Pines Corporation (“NPC”).

NPC issued a promissory note (“the Note”) for a portion of the purchase price, and secured the Note with the two liquor licenses. LeMai and Pace later divorced, and LeMai…