                                  _____________

                                  No. 95-3039MN
                                  _____________


In re: D & P Partnership;              *
D & P Partnership II,                  *
                                       *
           Debtors.                    *
                                       *
                                       *
--------------------------             *
                                       *
Norwest Equipment Finance, Inc.;*
Norwest Bank Minnesota Central, *
N.A.; Norwest Bank Minnesota,          *
N.A. (collectively, "Norwest"); *
Stearns County National Bank of *
Albany (SCNB),                         *   On Appeal from the United
                                       *   States District Court
           Appellees,                  *   for the District of
                                       *   Minnesota.
     v.                                *
                                       *
                                       *
Mahendra Nath; Ashok Mehta;            *
Torchwood Franchise Group,             *
Inc.,                                  *
                                       *
           Appellants.                 *
                                       *
                                       *
D & P Partnership; D & P               *
Partnership II,                        *
                                       *
           Defendants.                 *

                                  ___________

                   Submitted:      May 13, 1996

                         Filed:   July 31, 1996
                                  ___________

Before RICHARD S. ARNOLD, Chief Judge, MAGILL and MURPHY, Circuit Judges.
                               ___________
RICHARD S. ARNOLD, Chief Judge.


      The defendants in this case, collectively referred to as the Nath
Group, purchased assets from a bankrupt debtor, D & P Partnership.            At the
time of the purchase, the state of Minnesota imposed a sales tax on such
sales, which tax was paid.    Subsequently, Minnesota repealed the sales tax
with retroactive application, so that the tax on this sale was subject to
a refund.     The Bankruptcy Court held that the plaintiffs in this case,
secured creditors of D & P, were entitled to the proceeds of that refund.
The District Court affirmed.      We disagree and reverse.


                                          I.


      In January of 1991, D & P filed a Chapter 11 bankruptcy petition.
In time, D & P decided that a self-directed liquidation of its assets was
its   best   alternative,   and   its    creditors,    including   the   plaintiffs,
acquiesced in that decision.            The Nath Group and two other entities
submitted offers to purchase 17 of D & P's Burger King restaurants.


      Naturally, the three offers were not identical.         D & P put all three
offers before the Bankruptcy Court and allowed its creditors to choose
which offer they wished to accept.             They chose the Nath Group's offer.
Further negotiation led to an agreement that D & P would relinquish any
claim to the proceeds of the sale in favor of its creditors.               The Nath
Group, in turn, would receive title to the assets free and clear of any
existing liens.


      On the eve of the hearing at which the Bankruptcy Court would be
asked to approve the agreement, a problem was discovered.           The balance in
D & P's operating account was not sufficient to pay operating expenses,
administrative expenses, and the sales taxes on




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the sale if all of the proceeds were paid over to the creditors.        In an
attempt to remedy this problem, the Nath Group was asked to increase its
offer, which it refused to do.   Instead, the creditors, plaintiffs in this
case, agreed to accept less and allow part of the proceeds of the sale to
be allocated to the newly discovered expenses.       This plan met with the
approval of the Bankruptcy Court.   The sale was closed on October 31, 1991.
Subsequently, the Nath Group purchased two more restaurants from D & P
under an identical agreement.    The required sales taxes were paid over to
the state of Minnesota for both sales.


     In January of 1992, the sales-tax statute was amended to exclude the
sale of substantially all of the assets of a business from the list of
taxable events.    Minn. Stat. § 297A.25 Subd. 12 (Supp. 1996).          This
amendment was retroactive to June 30, 1991, meaning that the sales taxes
in this case were subject to a refund.     D & P applied for the refund, but
was denied by the Minnesota Department of Revenue.   It did not appeal that
ruling.   On the other hand, the Nath Group applied for, and was granted,
the refund.


     The plaintiffs then sued the Nath Group in the Bankruptcy Court to
have the proceeds of the refund paid over to them,1 asserting two theories
in support of their claim.    First, they argued that the agreement between
the parties required D & P, not the Nath Group, to pay the sales taxes.
Thus, the refund was property of the estate, and should go to the
plaintiffs as creditors.    Second, they argued that the Nath Group would be
unjustly enriched if it were allowed to keep the refund.      The Bankruptcy
Court agreed with both of these theories, and ordered the Nath Group to
relinquish the refund.     The District Court affirmed that decision.




     1
      D & P was made a party to the suit, but did not
participate.

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                                            II.


        We must first decide whether we have subject-matter jurisdiction to
hear    this    case.   Generally,     once    the    reorganization      plan    has   been
confirmed, as D & P's plan has been, the estate of the debtor, and thus the
bankruptcy court's jurisdiction, ceases to exist.              United States v. Unger,
949 F.2d 231, 233 (8th Cir. 1991).                  However, a bankruptcy court may
explicitly retain jurisdiction over aspects of a plan related to its
administration and interpretation.            Id. at 234.


        The Bankruptcy Court retained jurisdiction over the subject matter
of   this   lawsuit.     Article   X   of     the    Plan    addresses    the    continuing
jurisdiction of the Bankruptcy Court.                It reads that the "Court shall
retain jurisdiction until this Plan has been fully consummated" for various
purposes.      Among those purposes are the "interpretation and enforcement of
the terms of this Plan."


        We think this settles any jurisdictional question.                 Certain funds
were paid into the bankruptcy estate by the Nath Group.                  Those funds were
to be used to pay sales taxes and the plaintiffs, among other things.                    The
state of Minnesota saw fit to change its law and refund the sales taxes.
The plaintiffs now argue that the "terms of this Plan" require the Nath
group to pay the refund to the debtor so that it can be turned over to
them.    We do not see what could more clearly be a matter of "interpretation
and enforcement of this plan" over which the Bankruptcy Court retained
jurisdiction than is the plaintiffs' request.               We hold that the Bankruptcy
Court, and this Court, have jurisdiction over the subject matter of this
case.


                                         III.


        We turn, then, to the merits of this case.                At the outset, it is
important to realize that the plaintiffs are not claiming that




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they are entitled to the tax refund under the refund statute, Minn. Stat.
§ 289A.50 (Supp. 1996).   Indeed, the Supreme Court of Minnesota has made
it clear that purchasers, not sellers, are entitled to tax refunds.     See
Acton Construction Co. v. Commissioner of Revenue, 391 N.W.2d 828, 832-33
(Minn. 1986); Minn. Stat. § 289A.50, subd. 2.   Thus, the interpretation of
the Minnesota statute is not before us.    Under the statute, there is no
doubt that the Nath group has a right to the refund.   We must interpret the
terms of the contract between the parties and apply the equitable principle
of unjust enrichment to determine whether either one requires the Nath
Group to surrender the proceeds of the refund to the plaintiffs, legal
questions over which we exercise plenary review.


     The gravamen of the plaintiffs' argument is that the contract between
the parties shifted the responsibility of funding the sales taxes from the
buyer, the Nath Group, to the seller, D & P and its creditors.     The Nath
Group, it is argued, intended to part forever with the total purchase
price, and had no interest in how those funds were utilized.    It follows,
then, that any refund would belong to the bankruptcy estate because the
estate "paid" the sales taxes.     In other words, it is argued that the
contract between the parties mandates that the seller is entitled to the
refund.   See Acton, 391 N.W.2d at 832 n.5.


     Several portions of the writings between the parties are important.
In paragraph 2.1 of the Asset Purchase Agreement, the Nath Group agrees to
pay a set amount for the assets.   Paragraph 1.5, the critical portion of
the writings for present purposes, reads that


     The purchase price payable by the Buyers as set forth in
     section 2.1 is inclusive of any sales or use tax payable.
     Sellers agree to pay any sales tax owing, however, Sellers
     shall pay such sales tax from the proceeds of the Purchase
     Price (as defined in Section 2.1). Accordingly,




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      the dollar amounts distributed to the Sellers' designees may be
      reduced to pay any sales tax owing.


Finally,     the   Stipulation   Relating    to   Sale    Proceeds,    Settlement    of
Administrative Claim and Transfer of Franchises (the Stipulation) provides
that D & P "shall receive no proceeds from the sale and shall be liable for
any expenses of the Sale," including sales taxes.2


      This    language   at   most    does   nothing     to   change   the   statutory
presumption that purchasers pay sales taxes and are consequently entitled
to   refunds when the taxes are repealed.                Arguably, it refutes the
plaintiffs' argument altogether.        Paragraph 2.1 establishes the purchase
price.    That price, according to paragraph 1.5, includes sales taxes.             The
seller is directed to remit those taxes to the state.             As a consequence,
the funds distributed to the plaintiffs were reduced.             This language, as
we read it, says the Nath Group "paid" the sales taxes by providing the
funds to meet that liability.        The seller merely passed those funds on to
the state.


      The plaintiffs ask us to look outside the agreement in order to
bolster their argument.       First, as the plaintiffs' lawyer pointed out at
oral argument, this sale was not a typical sale between willing parties on
the open market.      It was a self-directed liquidation of the assets of a
bankrupt debtor.      Thus, the plaintiffs, as creditors, were merely trying
to minimize losses.


      Second, when the funding shortfall was discovered the Nath Group was
asked to increase its offer.      Its reply was that the offer on the table was
what it was willing to pay for the business, and all that it was willing
to pay.    Moreover, the chairman of the




      2
      Identical documents were executed for both the 17-
restaurant sale and the two-restaurant sale.

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Nath Group commented, in a deposition, that he never contemplated paying
an additional amount for sales taxes when he formulated his offer.     These
facts, we are told, show that the Nath Group intended to part forever with
the purchase price and leave the plaintiffs with the responsibility of
coping with any new expenses that might arise.


     Finally, the plaintiffs remind us that they were the ones who were
forced to sacrifice funds when the shortfall was discovered.   They gave up
a portion of the proceeds in order to facilitate the sale.        If some of
those proceeds are to be returned, it is only fair that they, not the Nath
Group, recoup those funds.


     These additional facts do nothing to alter our conclusion.           We
recognize that the Nath Group is recouping funds that it never expected to
recoup when it parted with them, but so would the plaintiffs if we held
that they were entitled to the refund.    The Minnesota statute entitles the
Nath Group to a refund of the sales taxes.         At minimum, there is no
provision in the contract that changes that outcome.


     This reasoning also disposes of the plaintiffs' unjust-enrichment
claim.   Under the Minnesota precedents, unjust enrichment occurs when one
party enriches himself at the expense of another illegally or inequitably.
See Christle v. Marberg, 421 N.W.2d 748, 751 (Minn. App. 1988).    Here, the
plaintiffs argue that the Nath Group's action in retaining the refund is
unlawful because it violates the terms of the contract.     We have already
held that, at a minimum, the contract is not contradicted by allowing the
Nath Group to retain the refund.   Thus, to do so cannot be unlawful and the
unjust-enrichment claim must be rejected.      There is nothing inequitable
about allocating money in accordance with a statute, and in a manner not
contrary to the parties' agreement.


                                    IV.




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     The judgment of the District Court, affirming the Bankruptcy Court,
is reversed.   The Nath Group is entitled to retain the proceeds of the tax
refund, and the Bankruptcy Court, on remand, is instructed to enter
judgment accordingly.


     A true copy.


           Attest:


                  CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.




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